Photographer: Andrey Rudakov/Bloomberg
A flood of discounted Saudi crude is heading for Europe, but Russia might just have the only producers in the world equipped to compete with it.
With some of the world’s lowest production costs, a flexible tax system and a free-floating ruble, Russian companies can keep pumping, even in an extremely bearish price scenario: Russian companies can ensure sustainable production until oil hits $15 to $20 per barrel, analysts from Bank of America Corp. to Raiffeisenbank say.
Saudi Arabia has escalated a battle for industry dominance after the collapse of the OPEC+ alliance last week. The kingdom has slashed prices and announced a massive production increase.
Russia’s Energy Minister Alexander Novak said his country’s industry will remain competitive “at any forecast price level.”