Saudi Arabia to restart price war with Russia?

Saudi Arabia to restart price war with Russia?

The price war between Saudi Arabia and Russia on the global oil market may start again when prices return to the level of $50-55 a barrel, Department Director of S&P Global Ratings in Russia Alexander Gryaznov said.

"Some kind of a pause has been taken in this war. It is disadvantageous for both players, Saudi Arabia and Russia, to continue the price war in this situation," the expert said. 

"However, when the price returns to $50-55 [per barrel], I would not exclude that the struggle for markets will continue," TASS cited him as saying.

According to S&P Global Ratings estimates, Brent oil prices will be at the level of $30 per barrel until 2020 year-end with subsequent recovery to $50 per barrel in 2021. Experts believe prices will be at the level of $55 per barrel in 2022 and later on.

Oil prices plummeted in March after Russia and Saudi Arabia failed to negotiate oil production cuts. Ex-allies intended to proactively ramp up production in April. Observes called it ‘the price war."

However, OPEC+ countries managed to finalize the deal on oil production cuts in May - June at their extraordinary meeting on April 12.

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