IEA: Russia and the middle East suffer the most from low oil prices

IEA: Russia and the middle East suffer the most from low oil prices


Oil prices will continue to be under pressure, likely drop another $ 3, said the Executive Director of the International energy Agency.

MOSCOW, 21 Jan. Executive Director of the International energy Agency (IEA) Fatih Birol believes that Russia and the middle East suffer the most due to the sharp decline in oil prices.

According to him, cheap oil is not necessarily bad for the global economy as a whole. This is bad for many countries, however for some well, for example for the European countries, China and India. More likely to suffer from low prices the middle East and Russia.

“If the oil price will remain at $ 30 per barrel, the GDP of the Middle East may decline by 20% in 2016, and Russia’s GDP by 10%. This is a very strong decline,” said Birol in an interview with Reuters.

Birol also said that oil prices will continue to be under pressure. “I think we can see a decline of 3 per dollar,” he added.

Since the beginning of summer 2014 to the end of last year, oil prices have fallen more than tripled — from 115 to 36 dollars per barrel of Brent, and in 2016 already dropped below $ 30. Fundamentally the decline is due to the high level of production in a world with slower demand, including because of the situation in China. However, such a deep drop, experts have been increasingly linked to financial factors, including the strengthening of the dollar.