Dvorkovich called a “bust” oil at $100


At the current stage of development of the world economy reasonable the price of oil would be $60-70 per barrel, rising above $100 is already too much, says Deputy Prime Minister of Russia Arkady Dvorkovich.

“Over $100 is overkill for the current stage of world development. Of course, we would be a little easier to live with higher oil prices, but not prohibitively high, they also create other kinds of risks. I think a reasonable range is from $60 to $70 per barrel, but it is achievable only when a new cycle of global growth after investments in the oil sector has stabilised at a new equilibrium level,” said Dvorkovich in interview to TV channel “Russia 24”.

Vice Prime Minister noted the difficulty of predicting oil prices, due to the fact that the oil market has reacted to the changing geopolitical situation, but because at certain moments of time oil prices may drop to $20 and increase to $100. While in the short-term drop of prices Dvorkovich big trouble not seeing it.

“We had pictures and $20 and $30 per barrel earlier and we were growing fairly rapidly,” he said.

For a long period to make, according to Dvorkovich, is ridiculous, because nobody knows what technologies will enter the market and how it will change in this regard the “energy mix”. Therefore the main task of Russian authorities is to focus on developing the non-oil sectors of the economy.

“It is important to adjust policies, plans, management system, so that it was configured on a different model of development, not directly associated with revenues from commodity exports, the maximum emphasis on non-commodity exports, to occupy new niches in the global market through new technologies. This contributes to the low rate of the ruble, which was formed at low prices for raw materials, oil, gas and other resources. The opportunities are there, and we are now engaged in preparation of the anti-crisis plan of adjustment of our model,” — said the Deputy head of the government.

On the eve of Dvorkovich at the Krasnoyarsk economic forum said that if OPEC and other oil exporters outside the cartel, will agree to freeze production, a further fall in oil prices should not be

Earlier today, the President of Ecuador, Rafael Correa did not rule out that the reduction in investment in the oil industry and the resulting drop in production causes oil prices will jump to $200 per barrel.

During yesterday’s trading session on the stock exchange ICE cost of a barrel of Brent crude oil fell to $32,69, in the end, trading closed at $33,1 per barrel, which is 3,44% below level of closing of previous trading day. Today, oil trades on the ICE not held in connection with the holiday.