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April 13, 2020

Pendulum Swings: Oil During Pandemic

The Roscongress Foundation held an online discussion entitled ‘Petroleum Pendulum: Are Global Oil Market Volumes Shifting? Russia’s Answer’.

Global oil markets are currently undergoing significant fluctuations. A sudden change in oil prices and a growing pandemic of coronavirus create new challenges for the global petroleum industry.

Participants of this online conference discussed key prospects of the existing situation and the outcomes of the historic virtual meeting of OPEC+ that took place yesterday. The discussion brought together the country’s leading experts in oil and gas markets, representatives of industry associations and consulting groups. The conference was moderated by Alexey Bobrovsky, Head of Economic Programme, Russia-24.

Maksim Nechaev, Director for Consulting of IHS Markit Russia summed up the OPEC+ meeting: “There is still nothing to celebrate. <…> OPEC and OPEC+ countries demand volume reductions spread evenly.”

OPEC+ ministers reconvened for the second emergency meeting on Sunday evening and reached the ultimate consensus to take the volume down in May and June.

Participants of the online conference ‘Petroleum Pendulum: Are Global Oil Market Volumes Shifting? Russia’s Answer’ also addressed potential ways to resolve the situation.

 “Taxation (for the oil industry) should be reduced. I would like to remind you that petroleum companies in Russia ought to pay 85% in taxes. If you account for all the cross flows, in Saudi Arabia tax is just 25%. In the USA, there are basically no taxes for petroleum production. They technically exist, but at the same time there are government support programmes. The cross each other out,” said Ruslan Tankayev, General Director of InfoTEK-Terminal and Leading Expert of the Union of Oil and Gas Producers of Russia.

The video is available on the Roscongress TV YouTube channel. If you have questions for our experts, you can leave them in the comments below.