According to the experts working for Analytical Credit Rating Agency (ACRA) from Russia, the long-awaited extension of the so-called Vienna Accord signed by OPEC and some of their non-OPEC peers led by Russia may eventually result in higher oil prices along with eliminating the long-lasting oversupply in the global market of crude oil. This is what the experts stated in the recent report on the prospects of the Russian oil industry until 2021.
To be more specific, the experts report that the mentioned agreement signed in November 2016 (took effect in January 2017) already contributed a lot to cutting the oversupply in the first half of the year. Now, the agreement participants hope that the decision to extend it for the next 9 months with do the job and send the prices much higher to let them make more money from their oil exports.
ACRA experts believe that the extension may even lead to a deficit in the international market to the amount of 1,5 million barrels a day in the near future. This assumption is also based on the IEA which predicts a 5,6-million-b/d increase in the global production of crude oil and a 7,3-million-b/d increase in the global consumption of crude oil by 2022.
However, they think that the 300K-b/d production cut for Russia won’t actually prevent Russian oil companies from reaching 549 million tons of crude oil produced in 2017, which is still 1,5 million tons more than produced in 2016.
