By Vestnik Kavkaza
According to Bloomberg, Saudi Arabia is engaged in predatory pricing in the oil market, lowering prices for Asian clients. At the moment, Saudi Arabia is selling oil at a lower price than any other Middle East exporter. Experts state that cheap Saudi oil can begin to compete with more expensive Russian oil in China.
However, Salambek Khadjiyev, the director of the Institute of Oil Chemical Synthesis, doesn’t see a tragedy in the oil crisis: “This is a normal phenomenon in oil prices – fluctuations, rises, falls. Many factors influence the situation – development of science, politics, economics. It is impossible to predict an oil price; otherwise, oil traders would be the richest people in the world. This is the fourth oil crisis within my memory. The falling of oil prices is natural; even though this time politics influences it more than economics.”
According to Khadjiyev, the policy is provided by the USA and Saudi Arabia – “the two countries are significantly involved in the process, as their economies allow them to do it. They are fighting each other today, rather than us. Still, the situation has damaged us as well.”
The academician thinks that “oil won’t rise to the previous level, but it will stay at a stable level; $50 is a good level. Our oil industry will work stably under $50.”
Khadjiyev thinks that the Grozny oil industry should be restored today. There are three reasons for this.
Firstly, Grozny needs new jobs. It used to process 21 million tons of oil; and almost a hundred thousand people worked on the complex of plants and corresponding facilities. Today there is huge unemployment.
Secondly, Grozny has huge technical potential. Today the oil institute is working there, there are small projecting institutes, GrozNII is still alive – one of the oldest oil institutes in the world.
Thirdly, “today Grozny is able to produce 4 million tons of oil annually; it is able to produce even more. The fact that oil production is not developing there is an economic problem. We will construct it for sure!” Khadjiyev says.
