Novak: the supply and demand of oil should be balanced in 2017

Novak: the supply and demand of oil should be balanced in 2017


Perhaps the recovery period, the balance of supply and demand on the world oil market is somewhat stretched. Most likely, the balance would be restored by early 2017, said Minister of energy Alexander Novak.

MOSCOW, 14 Jan. The Ministry of energy expects the balance of supply and demand in the oil market will be reached by early 2017, with the decline in oil prices to $ 30 per barrel is a financial 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 at the Ranepa 2016.

“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.

“Worldwide investment in mining is declining, there is an inertial process, at least, reduce investment and production. However, last year production has increased all over the world, this factor, which was planned in a shorter time, reducing between the parity of supply over demand, he, we see, is reduced more slowly than planned. This, for example, by analogy with the crisis of 1986 or 1970. Today, we see that this is probably the most prolonged period of falling prices over the last 40 years,” said Novak.

“In any case, we have to wait and see how the drop is of a volatile nature,” he added.