Gasoline consumption falls 20–30% in Moscow, 10–15% in cities

MOSCOW, Apr 2 (PRIME) -- Consumption of gasoline and diesel fuel fell by 20–30% in Moscow and by 10–15% in other cities due to the quarantine measures, Energy Minister Alexander Novak said in an interview to Ekho Moskvy radio station broadcast on Thursday.

“For instance, we see contraction of 20–30% in gasoline and diesel fuel consumption at Moscow’s fuel filling stations to lower car transportation and traffic intensity. Contraction in other cities stands at about 10–15% right now, I mean large cities,” he said.

Consumption of oil products in Europe is even higher. For instance, gasoline consumption in Belgium contracted by 70%. “I don’t think that it will reach 70% in our country, but estimates of our companies show that we will see reduction of up to 40% in consumption of oil products, at fuel filling stations in the first place,” he said.

The ministry does not rule out that oil prices will fall further, though not for long. The OPEC+ deal would have had little sense in the current conditions even if the countries had agreed to the Saudi Arabia’s proposal to reduce production more, he said.

“I can even say that the OPEC deal would have had an absolutely zero impact even if Saudi Arabia’s suggestion of a 1.5 million barrels a day cut (had been approved),” he said.

Raising production for Russia has no economic sense. It is also unclear whether the participants of the former OPEC+ reduction deal raised their oil output, because of difficulties with sales and a further market glut.

Novak discussed the situation with the Russian oil companies, and everyone expects it to get worse in the coming weeks.

“I talked to the heads of all oil and gas companies yesterday in an online conference mode. We discussed the market situation in general and on the domestic market as well, and all our assessment of the market situation is that it will get worse in the coming weeks because demand will continue falling,” he said.

The Russian ministry was yet to discuss the oil market’s condition with Saudi Arabia, but it is in dialogue with the other countries of the OPEC+ deal, he said.

The price for Russian oil is low, but it does not sell with a loss. “There is no loss because our production cost is low, we just have no income that we could transfer to the budget. As you know, budget income accounts for about 60–70% of our oil price,” he said.

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