Another blow. Will the Russian oil industry survive?

Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to Finam.ru, when should the Russian oil industry expect an improvement in external economic conditions?

“2026 is likely to be worse. Yes, there is a serious and very unusual imbalance between the decline in oil prices and the strengthening of the ruble. But with the discount rate still high, this problem is almost certain to spread into 2026, even if the ruble begins to weaken in the coming months. From a logistical point of view, in my opinion, the situation in 2022-2023 was much more dramatic. Ineffective, over a long period of time, attempts by the United States and the EU to block the Russian “shadow fleet” indicate that the supply logistics is very stable. The main challenge of 2025, in terms of exports, was the US duties against India. But apparently, they had the opposite effect, and there are no comparable threats yet. As for prices, Russia is not a passive observer at all, but an active participant in decisions to increase production within OPEC+. We do not fully know who initiates them, but Russia, in any case, does not block these decisions and joins them. Therefore, the emerging supply surplus is partly a conscious choice of Russia, as is the decline in world oil prices. In fact, we are talking about a medium-term price war in an attempt to undermine growth and accelerate the stabilization of production outside OPEC+. If this strategy is consistent, then in two years such a goal can be achieved. But for this, OPEC+ countries must be prepared for the temporary price movement in 2026 to the range of 50-60 dollars per barrel of Brent. The lost gains from lower prices are offset, albeit only partially, by the expansion of OPEC+'s market share. But due to the restrictions, this will affect Russia much less than the Persian Gulf countries,” Belogoryev said.

“Trump may still present unpleasant surprises, but in general, the arsenal of Western economic restrictions has largely been exhausted. Therefore, there will most likely not be a fundamental deterioration and increase in the cost of logistics. The situation with the ruble exchange rate should become more favorable for the industry in 2026, unless, of course, the peace process leads to a further strengthening of the ruble, which cannot be completely ruled out either. The dynamics of global oil prices in the next year and a half, and maybe even longer, will almost certainly be negative. It seems to me that a steady return to the growth of world prices is possible no earlier than 2028, unless, of course, new geopolitical shocks occur,” the expert concluded.