The oil market will be down for the next five years, according a review by the National Credit Ratings (NCR) agency.
According to the experts, oil prices may remain low until 2025. Moreover, oil price wars may flare up again, sending the prices tumbling, unless new agreements on the limitation of production within OPEC+ are reached.
Once the OPEC+ deal to cut global petroleum output by nearly 10% expires, several scenarios are possible in the oil market.
The first one envisages free competition. Countries will not be able to reach a new agreement, and the oil price of will be determined by market laws. As a result, companies that extract shale oil in the United States will leave the market. The average oil price will be $30–40.
The next scenario will become a reality if the OPEC+ countries succeed in extending the recent deal. Then the demand for oil will increase, and the average price will rise to $45-50, RBC reports.
Also, according to the experts, there is a possibility that the US and Canada, as well as other countries, will accede to the agreement; this may raise oil prices to $50–55.
Finally, if the US absolutely refuses to join the oil deal, and begins subsidizing its own oil producers, the average oil price will be $25–30 on the world market, but $50–55 in the United States proper. This is the most disadvantageous scenario for Russia.