Reuters reports Alexander Novak, the Russian energy minister, as saying that the recovery in the demand for oil may have reached 90% of levels before the pandemic, with him expecting a full recovery some time in 2021.
Novak also said that Russia would suggest that the parties of the OPEC+ production deal react appropriately to this. He said:
“We will monitor the situation and balance oil output as the [global] economy is recovering… We hope for speedy demand recovery and will propose to react to it under [the] OPEC+ deal.”
Novak also spoke recently at an online meeting about factors and trends for the Russian oil and gas industry. He expressed his belief that the OPEC+ deal had brought much needed stability to the oil markets, saying that oil prices would otherwise have been $10-20 per barrel, rather than the current $45, with prices occasionally going negative.
Talking about the production cuts Russia had made, Novak said it had reduced production by 19% for the May–July period, and expected 13.8% lower production between August and the end of the year. Even without the OPEC+ deal, he said falling demand would have led to similar cuts being needed, as was the case with US producers like ExxonMobil, the oil company behind the Mobil range of industrial lubricant products.
Novak also mentioned the coronavirus vaccine that Russia recently approved, pointing out how it may positively influence the recovery in oil demand by avoiding a second wave of COVID-19 infections.