The Russian energy minister, Alexander Novak, has highlighted the importance of Russia, as well as other major oil producers, regaining and even increasing its share of the oil market once demand returns to normal levels.
Novak points to how the low oil prices resulting from the coronavirus pandemic had led to a lack of investment in production this year, with this not expected to fully recover next year. He says this could cause global oil production to drop by 5 million barrels per day (bpd) in a few years’ time, according to forecasts by Rystad Energy.
In an article published recently in the in-house magazine of the energy ministry, Novak said that in this environment:
“When demand begins to return to pre-crisis levels, it will be extremely important for Russia, like other oil-producing countries, to regain market share as soon as possible and, possibly, even increase it in the face of reduced competition between producers.”
For some years now, Russia has held back its oil production as part of the OPEC+ group’s collective efforts to balance the oil markets. In the meantime, US shale operators—such as ExxonMobil, the oil giant behind the Mobil lubricant range—have gained market share and made the US the world’s biggest oil producer.
Novak said preparations are underway for a scheme to encourage the drilling of unfinished wells that could be rapidly switched to production once the OPEC+ deal expires, which is currently expected to happen in April 2022.
