Gazprom Neft sees new equilibrium oil price at $50–55/bbl

ST. PETERSBURG, Jun 1 (PRIME) -- Russian oil major Gazprom Neft expects that a new equilibrium oil price will be U.S. $50–55 per barrel due to market stabilization reached by OPEC and non-OPEC states’ actions to cut oil production, CEO Alexander Dyukov said Thursday at the St. Petersburg International Economic Forum.

“Due to balancing of the oil market the price situation will become more stable and predictable. Nobody can now provide a new equilibrium price level. I hope it will be in the range of $50–55 per barrel or a bit less, but it is not that important. It is important for us to stabilize the market,” he said.

Gazprom Neft will be technically able to restore its oil production after the termination of the oil cuts deal within several weeks, Dyukov also said.

OPEC states agreed to reduce production by 1.2 million barrels daily to 32.5 million barrels in November 2016. In December 2016, 11 non-OPEC countries agreed to cut their combined output by 558,000 barrels, including Russia, which has agreed to slash production by 300,000 barrels daily compared with the level of October 2016.

On May 25, participants of the oil output reduction deal agreed to prolong it for nine months, until April 1, 2018 with the terms unchanged.

Gazprom Neft will send more oil for exports in 2017 due to repairs at its oil refineries, Dyukov also said. Hydrocarbon output will amount to 89.2 million tonnes, and oil refining to 36.1 million tonnes, he said.

Dyukov also said that Gazprom Neft is currently discussing technological cooperation with Saudi Aramco and plans to sign an agreement on technological cooperation with the U.S. oil service company Halliburton at the forum.

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