Russia's Energy Ministry: "Oil prices may start to grow again after 2020"

  • 10:00 27 December 2019

Russia's Energy Ministry: "Oil prices may start to grow again after 2020"

Oil prices may start growing again after 2020 because of the decreasing supply on the global market, according to the draft Russian Energy Strategy published on the website of the Russian Energy Ministry, ONA reports citing TASS.

"Accelerated development of the most effective reserves and decreasing investment into geological exploration and into oil and gas projects in different regions will create prerequisites for the decreasing supply of oil after 2020, which will require intensive investment into shale and other costly projects and may lead to the start of the new phase of price growth," the draft document says.

The draft notes that the level of future oil prices will be determined by several factors — growth rates of the world economy, situation on financial markets, break-even level of shale oil development in the United States, as well as political developments.

"It is forecasted that the growth of global demand for oil will slow down after 2025 and possibly reach its peak before the 2030s. Demand for oil products will be formed under the influence of growing consumption in the transport sector simultaneously with decreasing demand in the household and commercial sectors, as well as in the electric power industry," the draft document adds.

According to the document, demand for motor fuels will grow up until 2035, while consumption of fuel oil and other dark oil products will decrease in the same time period, especially on the European market.