Russia Deputy Prime Minister says IEA’s net zero plan could push oil price to $200

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Russia Deputy Prime Minister Alexander Novak says the International Energy Agency (IEA)’s call for a halt to global oil and gas developments could push oil prices to $200 a barrel.

“If the international energy agency’s decision to avoid financing new energy ventures is implemented, oil prices may hit $200,” Novak said on Thursday as preparations get underway for the upcoming OPEC+ conference set for August.

He said the upcoming conference will address and finalize oil output for August or other months while pointing out that this year and next year, oil firms will increase their investments.

“Seasonal oil demand will rise in the third quarter,” he stated, adding that Russia is satisfied with the present oil price. Novak was quick to also point out that if oil prices are too high, this may force users to switch to other energy sources.

Oil prices surged on Wednesday, hitting their highest in more than a year from a decision by OPEC and allies to stick to the plan to gradually restore supply, along with the slow pace of nuclear talks between Iran and the United States.

Novak’s remarks on the IEA’s landmark report follows comments from Saudi energy minister Prince Abdulaziz bin Salman, who said he give the report Zero stars and two thumbs down and that it is unworthy of consideration.

“I would have to express my view that I believe it is a sequel of [the] La La Land movie,” Prince Abdulaziz told reporters Tuesday after OPEC+ ministers met to affirm production levels through July. “Why should I take it seriously?”

The IEA’s roadmap concluded that if the world were to slash carbon emissions to net-zero over the next three decades, global oil supplies would need to shrink more than 8% annually, down to 24 million b/d in 2050, from pre-pandemic levels of just above 100 million b/d. That would mean no new oil and gas upstream projects should be developed.

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