International Energy Agency uses market report to point to biggest potential loser from oil price slump
Russia will be the biggest loser from the current downturn in oil prices as the Organisation of the Petroleum Exporting Countries (Opec) seizes back a bigger share of the world crude market, the world's top energy watchdog has said.
In its closely-watched medium-term market report the International Energy Agency (IEA) said that Russia's output of crude would contract by 560,000 barrels per day (bpd) through to 2020.
"Russia facing a perfect storm of collapsing prices, international sanctions and currency depreciation, will likely emerge as the industry's top loser," said the IEA.
The Paris-based agency also said that US shale oil output will continue to grow through to the end of 2020 despite a 50pc slide in the price of crude since June, which has threatened the profitability of fields in North America.
Oil prices, which have rallied over the last week, have been under pressure since the end of last year when the Organisation of Petroleum Exporting Countries (Opec).
"There has never been a situation like we face today," said Maria van der Hoeven told an audience of oil industry executives on Tuesday at IP Week in London. "This time around it's not business as usual."
The IEA expects crude prices to average $55 per barrel throughout 2015 but warned the suppliers of oil will increasingly cut back on expansion projects.
"As producers take an axe to their spending, supply will grow far more slowly than previously projected, but global capacity is still forecast to expand by 5.2m bpd by 2020, and the toll on production will vary by country," said the IEA.