A representative of a Russian oil company told Bloomberg on October 23 that OPEC and its allies ought to take a slightly different approach to formulate production plans.
Sergey Vakulenko, the head of strategy and innovation at Gazprom Neft, suggested that the OPEC-plus deal might be more effective if its adherents included projections for U.S. shale oil production and global oil demand growth in their calculations. Doing so would allow OPEC and its allies to predict what share of the world oil market U.S. shale producers are likely to command, he said.
“We think that the mechanism of the alliance might become more sophisticated,” Vakulenko commented. “Currently we’re looking just at stocks and averages, [but we] could look at other signals like production levels and forecasts for demand growth.”
Gazprom Neft, which is majority-owned by state-controlled Gazprom, is one of the companies that regularly presents information on oil supply and demand trends to the Russian Energy Ministry. It has no direct influence over decisions related to the OPEC-plus deal, though.