Novak: the fall in oil prices to $30 is of a financial nature

Novak: the fall in oil prices to $30 is of a financial nature


Role in reducing oil prices to the level of 40-50 dollars played the fundamental factors that affect the balance of supply and demand, with regard to $ 30, this decrease is of a financial nature, said Alexander Novak.

MOSCOW, 14 Jan. The process of finding a balance between supply and demand on the world oil market is delayed and will be completed in early 2017, however was a fundamentally reasonable prices only drop to $ 40-50 per barrel, and continued to decline to 30 dollars is financial in nature, said the Minister of energy Alexander Novak.

“There are fundamental factors that affect the balance of supply and demand. In my opinion, the fundamental factors played a role in the decline to the level of 40-50 dollars regarding $ 30, this decrease is of a financial nature,” said Novak reporters on the sidelines of the Gaidar forum.

“Maybe a cooldown period, let’s say, the balance of supply and demand, he is somewhat stretched. Estimates were that maybe by the end of 2016, seems now that it is in the beginning of 2017,” said Minister of energy of the Russian Federation.

He noted that the worldwide declining investment in oil production, however, last year it has grown, and the difference between supply and demand decreases at a lower rate than expected by analogy with the crises of 1986 or 1970. “Today we see that this is probably the most prolonged period of falling prices over the last 40 years,” continued Novak.

“In any case, we have to wait and see how the drop is of a volatile nature”, — said the head of the Russian Ministry of energy.

Since the beginning of summer 2014 to early 2015, oil prices have fallen by more than half, from 115 to 48.5 dollars per barrel Brent. In 2015, the quotations did not rise above 67 dollars, and in 2016 they went down to 30 dollars per barrel.