BP chief economist: If oil price rises to $100, it will not be continuous

Baku. 7 November. REPORT.AZ/ The oil price may rise to $100 a barrel, but it will not be continuous, Vladimir Drebentsov, BP Chief economist for Russia and CIS countries, said in Baku.

"Oil price may rise $100 a barrel, even higher than $100, but it’s not right to forecast that it will continue for five years. The price of this level is not sufficiently continuous," he said.

According to the economist, geopolitical factors will play a significant role in the oil prices in the mid-term period.

He cited reduction in Venezuelan output, sanctions against Iran as example: "The factor of Venezuela is a significant factor in the oil price. It’s unclear whether the output will stabilize or decline here. The second geopolitical factor is US sanctions against Iran. As a result of these sanctions, Iran’s oil declines in the market. However, the decline of Iran’s oil will not constitute a physical shortage because Saudi Arabia will compensate the declined volumes through its reserves. But if transportation of Iran’s oil declines in the mid-term period and output in Venezuela is maximally reduced, this may lead to shortage in the market."

The chief economist also noted that the oil output in the United States will be twice as high as in Saudi Arabia and Russia in 2030s. According to him, the base price of shale oil will also go down.