The speaker: low oil prices will remain for a long time

The speaker: low oil prices will remain for a long time


Nani the prices for oil steadily falling for about 18 months because of the glut in the oil market. With an average annual price of oil at 35 dollars, Russia’s GDP will fall.

MOSCOW, 13 Jan. Low oil prices will persist for a long time, said the head of Ministry of economic development Alexei Ulyukayev.

“According to the logic of markets, the lower (price) will fall today, the more likely (it is) rebound tomorrow. And it’s not the biggest risk. The biggest risk that (will be) a long the low prices (for oil), we have () years, decades. This means critical decisions associated with structural changes in the economy”, — said Ulyukayev, speaking at the Gaidar forum.

According to him, the low prices for oil will remain for a long period.

Oil prices fall steadily for about 18 months because of the glut in the oil market and a high level of production of “black gold”. In the new year the price of a barrel of Brent oil was already down in the area of 30.5 per dollar.

Under the stress scenario the Central Bank of the Russian Federation, with an average annual price of oil at 35 dollars the fall in GDP could be around 2-3%. In the baseline scenario of the Central Bank, assuming oil price at $ 50 per barrel, the decline in the economy next year is expected to be 0.5-1%.