Sechin: Oil Will Cost $ 60 per Barrel if Shale Oil Disappears

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The cost of oil by the end of the year will be at $ 60 per barrel if shale oil leaves the market. This announced to reporters the head of Rosneft Igor Sechin. According to Sechin, OPEC has lost its importance and Russia must maintain market share. While Russia was reducing production under an OPEC agreement the United States was the first in the world to produce oil, something that has never happened before, the head of Rosneft said. The head of Rosneft also said that he did not consider current prices to be dramatic. But they, according to him, do not bring much joy. “The market will be corrected and I think fast enough. Within six months we will see those changes in a more stable, right direction,” quoted TASS. According to the head of the Russian company, current oil prices do not allow efficient production of shale oil and shale projects in the US will be closed. In early March, Russia and the OPEC countries did not agree on an additional reduction in oil production amid the demand decrease due to coronavirus outbreak. This led to a collapse in oil prices and the Russian currency ruble fall. In response, Saudi Arabia announced its intention to increase the supply of raw materials to the market by more than 25%. Co-owner and vice president of the largest private oil company LUKOIL Leonid Fedun called the fall in oil prices catastrophic. If Russia and OPEC could agree to extend the deal, then a barrel of oil would now cost about $ 50. According to Fedun, at the meeting of oil workers with President Volodymyr Putin preceding the OPEC meeting, nobody discussed Russia's withdrawal from the organization. Rosneft was the first to support Russia's withdrawal from the agreement to curb production with Saudi Arabia and other OPEC countries. According to Fedun, due to the collapse of the agreement, Russia and Saudi Arabia announcing plans to increase oil production are to face the most “negative situation”. According to LUKOIL experts, incomes of the American population will grow by six percent due to low oil prices. At the same time, in Russia, according to Fedun, due to the peculiarities of the tax system even with a drop in oil prices, the cost of gasoline will not decrease by half price.