Russia’s Rosneft CEO: Heavy spending cuts may lead to deficit Oct

LONDON, Feb 10 (PRIME) -- Excessive spending cuts on investment may trigger an oil deficit in October–December, CEO of Russian oil major Rosneft Igor Sechin said at conference IP Week on Tuesday.

“Lower investment will inevitably help restore the balance between demand and supply on the oil market but excessive investment cuts may provoke an oil deficit as early as in the fourth quarter of this year,” Sechin said.

Shale oil development and “hedging of development by independent producers” has buffered spending cuts so far, he said.

Sechin also said that the OPEC policies are detrimental for other market participants. “A group of countries of the Middle East conducts its own policies and bearing in mind interests of other OPEC members is of secondary importance for them.”

Russia cannot become an OPEC member, he said. “We treate this organization with respect, they want to see us as participants but we cannot become part of OPEC due to Russian output features.We are ready to join OPEC as observers.”

He separately said that sanctions against Russia will harm European refineries. “Sanctions against Russia are targeted at undermining long-term oil supplies to the market and lead to the growth of difference between Brent and WTI which hurts European refining.”

End