Shahmar Movsumov: “Oil prices are likely to remain at current level in medium term"

  • 11:18 21 July 2020

Shahmar Movsumov: “Oil prices are likely to remain at current level in medium term"

Assistant to the President of the Republic of Azerbaijan - Head of the Department of Economic Issues and Innovative Development Policy Shahmar Movsumov revealed his forecast regarding oil market and oil prices, ONA reports.

Mr. Movsumov told ONA that the price of oil depends on demand and production, and today consumption, demand for oil decreased due to pandemic: "As a reaction to this, OPEC+ countries have reduced daily production by about 12 million barrels. This allowed the market to balance prices. At the end of this year, in order to forecast the price of oil for the next year, we should look at how consumption and production will change. If the pandemic continues like this, it means that production in other words demand will not increase. But if the pandemic slows down, demand will gradually increase as people become accustomed to living with the virus. As a result, this will cause an increase in oil prices. At the same time, we have a little reserve in the production, we will have an increase in those reserves.”

The presidential aide also noted that it is difficult to make any long-term forecast related to oil prices: "But in the medium term, oil prices are likely to remain at the current level."

Note that today the price for one barrel of Brent and WTI ethanol crude oil is $ 43.45 and $ 41.05, respectively.

Recall, according to the latest forecasts of the Energy Information Agency under the US Department of Energy (EIA), this year the price of Brent crude oil will average $ 40.5 per barrel, and next year this figure will be at $ 50. The average price of WTI crude oil in 2020 is predicted by the agency at $ 37.55 per barrel. It is assumed that next year this figure will be at $ 45.7.