NEW YORK, January 28. /TASS/. It will be extremely difficult to achieve the goal of the new US President Donald Trump to significantly increase the production of hydrocarbons, and a significant drop in oil prices should not be expected, even after the approval of the development of new fields, Director of American investment company Navigator Principal Investors Kyle Shostak said in an interview with TASS.
"Despite Trump's stated goals of reducing energy costs for American consumers, achieving them in the modern context will be a very difficult task. I do not expect a sharp increase in oil production and, as a result, a significant drop in oil prices as a result of Trump's actions, even if new fields are allowed to be developed," he said.
The investor pointed out that although in theory the policies of the new US administration could lead to the saturation of the hydrocarbon market, "in reality things are different for now". "Thus, for a comfortable increase in production, US producers need a price of about $89 per barrel, against the current $74 per barrel, otherwise such an increase in production will not be profitable," he noted.
In addition, Shostak emphasized that due to the sanctions, supplies of Russian and Iranian oil to the international market are limited, which leads to "a significant increase in the price of Middle Eastern Murban oil, which is now the main alternative for Chinese and Indian consumers looking for a substitute for sanctioned Russian supplies". This state of affairs, the investor pointed out, "benefits Saudi Arabia, which has to balance its budget at $90 per barrel". "As we can see, the US efforts to reduce prices will face significant resistance, directly or indirectly, from Saudi Arabia and OPEC+, which have already sent clear signals about postponing plans to increase production until the end of 2026," Shostak concluded.
Last week, Trump said the US would seek lower oil prices from Saudi Arabia and OPEC, in order to put pressure on Russia among ither reasons. Speaking at the World Economic Forum, the US president also said that OPEC countries should have lowered oil prices long ago. In his opinion, this would have made it possible to resolve the conflict in Ukraine.