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Oil price reduction to move terms of Russia's capital-intensive projects — Rosneft CEO

November 26, 2014, 10:22 UTC+3 VIENNA
Russia's oil giant Rosneft has already cut its production volume by 25,000 barrels per day
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© EPA/ALFREDO GUERRERO/HO

VIENNA, November 25. /TASS/. Reduction of oil prices may cause the terms of capital-intensive projects to move, which would affect the general oil supply level, Russian state-owned oil company Rosneft CEO Igor Sechin said Tuesday after an international oil conference in Vienna involving Russia, Saudi Arabia, Venezuela and Mexico.

“The current level of prices is not critical for us. We may shift the terms of implementation of these or those capital-intensive projects. Of course, this will affect the general level of oil supply,” Sechin said.

The Rosneft chief said that in order to balance demand and supply, all or most large market participants need to take coordinated actions.

He stressed that it is necessary to distinguish specificity of the oil industry of most OPEC members and Russia. Considering all climatic, logistical and technological factors, the Russian Federation can’t change production levels immediately but is capable of taking structural measures with consequences in the mid and long terms.

Sechin said Rosneft has already cut its production volume by 25,000 barrels per day, but that it is connected with an increase in production efficiency and increased efficiency for company shareholders, as well as marketing conditions.

Market participants should more promptly react to its changes, so it is necessary to proceed to a deep joint analysis of market facts and prospects, and ensure a greater transparency of the market, he said.

Earlier it was reported that oil prices have dropped by nearly $40 per barrel over the past five months.

The news agency Bloomberg reported Tuesday citing Sechin that a plunge in world oil prices to below $60 per barrel will not cause a contraction in Russia’s oil output.

“Russian oil producers can work in various price conditions and will react to market demand,” Sechin said.

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