French expert: "Oil price will rise after coronavirus ends"

‘After the crisis ends, essential changes will occur in oil economy,’ President of the Institute for European Prospective and Security (IPSE) Emmanuel Dupuy told Report.

According to him, the decline in oil price was caused by two factors: ‘Oil price is in the lowest level in its history. On one hand, this was caused by COVID-19 pandemic. Almost half of the planet are under quarantine, and therefore, tankers full of oil are waiting without moving. On the other hand, we cannot say that if the coronavirus crisis had not occurred, the oil price wouldn’t have fallen. Decline in oil price was being expected and the crisis just accelerated it. US has become an oil producing country by increasing output to 10-12 million barrels since 2018. Saudi Arabia, which produces 10-12 million barrels per day, had to meet the new rival in this market. This issue has become the joint care of Russia and Saudi Arabia. So, the oil price decline was caused by COVID-19 and plenty of oil.’

Emmanuel Dupuy said that Azerbaijan, as an oil producing country, is directly related to this issue: ‘However, Azerbaijan has advantages in three fields. First, Azerbaijan is not only an oil exporting country, but also a gas exporting country. Second, along with production of oil and gas, Azerbaijan is a transit country. Third, Azerbaijan has opportunities to support the oil companies of the western countries. Azerbaijan has a geographical closeness with Middle Asian countries and Russia. Therefore, it can easily establish a dialogue with Anglo-Saxon and Russian companies at the same time. Azerbaijan has a potential to be not only a mediator, but also a country playing regulating role in this issue. Besides, Azerbaijan could strengthen its ‘de facto’ rights in this field as an oil producing country.’

The expert noted that after the crisis ends, essential changes will occur in the oil economy: ‘Oil price is expected to go up after the coronavirus crisis ends. A demand after a stagnation during the crisis will cause growth in oil price. However, it won’t rise to a level that was before. Some countries pay special attention to the development of alternative energy types. However, the fossil energy will remain as the main energy type. Some sources think that the oil price will rise to $46 a barrel in 2023. In the future years, maybe decades, the oil can be on the agenda as an important issue.’