Alexander Frolov, Deputy Director General of the National Energy Institute, in an interview with the newspaper “News” The North Sea benchmark predicted that Brent could stay at current levels or rise to $80 a barrel in May. Last week, the price of fuel first fell 10% from $80 to $72, then rebounded to over $75.
According to Frolov, a sharp fall in oil prices is no longer possible, since there is a regulatory body – OPEC +, which monitors the balance of supply and demand in the market. The expert said that the effect of the voluntary reduction of oil production by the alliance countries announced in April will start to affect the market confidently from the end of May.
Frolov said that the oil price level of $70 per barrel is unprofitable for many producing countries, especially the USA and Norway. He explained that if the cost of fuel falls, producers will reduce the supply, as in 2014-2016. Frolov is confident that if prices stay below the optimal investment corridor (at $80 a barrel) for a long time, the market may face a shortage that neither producers nor buyers care about.
4 May, Deputy Prime Minister Alexander Novak declarationRussia is currently reducing its daily oil production by 500 thousand barrels compared to February. At the same time, follow-up will be made according to independent sources.