The situation on the oil market, according to the head of “Rosneft”, is characterized, in particular, the continuing imbalance of supply and demand, dramatically reduced the price values of the indicators significantly increased uncertainty.
MOSCOW, 6 Nov. The volume of supply of oil on the world market exceeds demand by one million barrels a day and may remain at this level until the end of 2016, said the head of “Rosneft” Igor Sechin.
“In September of this year the excess of supply over demand in the world oil market shrank by more than 1.2 million barrels per day, but is still more than 1 million barrels per day and, according to forecasts, may continue until the end of 2016. As a result, the situation on the oil market is characterized not only by the continuing imbalance of demand and supply and radically reduced the values of price indicators, but also greatly increased uncertainty, high risks and growing competition,” said Sechin, speaking at the international conference on energy cooperation between Russia and Japan.
The head of “Rosneft” has reminded that at present total debt of only twenty five companies engaged in shale production is about 150 billion dollars. “It is estimated that the existing hedging arrangements and extended credit secured by inventory at low prices may persist, although to a lesser extent, until 2017”, — he noted.
Sechin stressed that the most important factor determining the sustainability of shale production, and affecting the future of the global oil market is the progress of technology. At the same time, uncertainty remains as to the measure of influence of this factor on production volumes, associated primarily with the quality of the resource base.