Russia, Azerbaijan contributed to stabilization of world oil market: Expert

"The day before, the price of Brent North Sea oil exceeded $ 35, futures for the American WTI futures crossed over $33, while the Russian Urals surpassed 30 US dollars. The last time oil prices of these grades were at this level in early April (Brent) and mid-March (WTI, Urals). According to the results of last week, Azeri Light also feels confident, the average price above $ 31per barrel."

Deputy Director, International Energy Policy, and Diplomacy Institute of Moscow State Institute of International Relations under the Ministry of Foreign Affairs of Russia (MIEP MGIMO) Igbal Guliyev told the Russian Bureau of Report.

"As we believe, such market sentiment is associated with the beginning of a real reduction in the oil market by majors, increased demand in China, as well as the easing of quarantine restrictions in oil-importing countries. Leading oil-producing countries have accelerated the pace of production cuts. As I think, Saudi Arabia, Kuwait, and the UAE will reduce oil production in June over their obligations under the OPEC+ deal."

Guliyev noted that Russia and Azerbaijan have also started reducing oil production since May 1: "Thus, our countries have contributed to the launch of stabilization of the situation on the world market. Current conditions do not allow to achieve an immediate balance in the oil market in the current conditions. Currently, the reduction of production to fully compensate for the decrease in demand cannot be achieved owing to agreements of oil-producing countries. These countries' joint efforts can reduce the peak of oversupply and reduce the growth of oil reserves."

According to the expert's forecasts, OPEC+ participants will take additional measures to stabilize the market situation: "OPEC has repeatedly managed to balance the oil market, but this time the situation is aggravated by the state of the world economy. A voluntary reduction in production over the commitments of several countries may be a call to tighten the deal at the next OPEC+ meeting, which is due for June 9-10."

"Notably, Azerbaijan, as part of its obligations under OPEC+, plans to reduce the production of "black gold" in the period from May 1 to July 1 by 164 thousand barrels per day (from the level of October 2018), while the volume of production will be 554 thousand barrels per day. According to the current agreements, quotas will be relaxed from July – production by the end of the year can reach 587 thousand barrels, and from 2021 to April 2022 - 620 thousand barrels,"