Novak sees $65-$80/barrel as comfortable oil price for Russia in 2022

Novak sees $65-$80/barrel as comfortable oil price for Russia in 2022

An oil price in the range of $65-$80 per barrel will be comfortable for Russia next year, Russian Deputy Prime Minister Alexander Novak said in an interview with RBC.

"Right now the oil price is about $75 per barrel. For us, a price of $65-$80 per barrel will be comfortable next year. I am intentionally taking such a large range, because volatility on the market is not being ruled out. In principle, our budget in 2021 balances at $43.30 per barrel and $44.20 is factored in for 2022, while the socioeconomic development forecast anticipates higher prices," Novak said.

Although the pandemic is continuing, demand for oil is still growing, he said. "The market was stable. Constantly growing demand this year was covered by the restoration of production. We expect that total demand in 2021 will increase by about 4.5 million-5 million barrels per day," Novak said.

"For the restoration of production to the level it was at before the imposition of restrictions in 2020, we expect demand to grow by about another 4 million bpd next year," Novak said.

"There has been a substantial rebound in the global economy since the drop last year, foremost due to lockdowns. Now we're seeing that even the spread of the new delta and omicron coronavirus variants are not affecting the reduction of the population's mobility as much. The governments of many countries have adapted and close them down less. Of course, vaccination is influencing this - billions of doses of vaccine have already been made in 195 countries," Novak said.

"As a result, despite the ongoing pandemic, oil consumption is still growing. This indicates that the economy is continuing to recover. Growth will continue next year," Novak said.

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