- The price of Brent fell below $49 for the first time in six months. What is the reason? And what should we expect afterwards?

- We see a general downward trend in oil prices. Attempts to pull the price to the level $50-60 with OPEC agreements are just grasping at straws. There is no oil shortage on the world market. On the contrary – there is a surplus of production capacities.

The pressure on the market, caused by new producers, is growing. In particular, the United States became more active. The more the United States extract its own oil, the less they import. And the result is that a glut of oil on the world market is increasing, which leads to lower prices. How steady will be this reduction - is stil the question. I think the price will still go up and down.

- By the way, the US President Donald Trump continues to lift restrictions on oil production. It is believed that in the medium term it can seriously cause prices to collapse...

- If we are talking about a several years term, then yes, prices will decline. I would not say that it will be collapse of prices, but the measures planned in the framework of Trump's Administration energy policy are aimed at increasing oil production in the US. And in the end it will lead to what I have already mentioned - to reduction of imports. Because now the United States are # 2 importers of crude oil after China. But this import is constantly decreasing.

This trend looks a bit like the situation that we saw with the American shale gas. In the 2000s the USA were the largest global importer of gas. Now they are the exporter. One and a half decade has only passed.

The background, the long-term factor, which determines the behavior of prices, is just Washington's policy to increase the independence of the United States from imported oil. This policy is already being implemented. In the program of Trump's Administration, which was published on inauguration day, energy policy was most clearly spelled out. In fact, the United States want to repeat the shale gas revolution, but this time the oil one.

This is a factor that will continue to put pressure on the oil market. No matter how hard Russia, Saudi Arabia and other players would try in some way to raise prices - it is extremely difficult to imagine. Of course, every manufacturer and exporter of oil is interested in the highest price, but competition sets its own rules. Moreover, competition exists between major oil producers not only from the point of view of exports, but also from a policy perspective.

In fact, the OPEC was the regulator of prices before. But the Organization has irretrievably lost this role, and it happened at the end of the last decade.

So, the general trend is decline of oil prices, albeit there will be some hikes. You asked why the prices fell below $49 for the first time in last six months. But actually, this is not surprising. The surprise is that the oil price was above $49 per barrel for six months. Here is the phenomenon. The fall in prices is a natural process that is determined by many factors.

- Including technological one?

- Certainly. Technological factor is very important. We see transition from internal combustion engine to low-emission engine. Accordingly, the role of oil is reduced. This is a factor that will put pressure on the oil market in next decades. This does not mean that it's the end of the oil era. But it moves from the category of strategic resource into the category of conventional goods of restricted consumption. Because no one but refineries consume crude oil.

Now the market situation is determined, in fact, by 4 countries: the US, Saudi Arabia, Russia and Iran. But it is very difficult to imagine that they will make some sort of arrangement. This is because of the contradictions which exist between the two groups: "USA-Saudi Arabia" and "Russia-Iran". Not to mention that there are many frictions inside the groups. And the OPEC cartel is a motley mix of countries with very different production costs. What is acceptable to the Gulf countries, is fatal to Venezuela or Ecuador. For them the price below $50 is already a huge problem. While Saudi Arabia can withstand a price of $20.

- What minimum oil price will survive Russia with?

For Russia, the "killer" prices are $30 per barrel and lower. But this does not mean that when this price is established, the economic collapse of Russia will come immediately. For that effect a low price should be kept for a few years, but, as I said, it is volatile. There still will be oil price hikes after the fall that we see now. After all, oil speculators work actively, but their activities can have only limited effect.

- And what can reverse the downfall trend of oil prices?

The only scenario that may lead to a steady growth of prices is the collapse of Saudi Arabia in case of strong internal cataclysm. It has been long predicted, but it has not happened yet, though, according to many, the ruling gerontocracy is leading the country to a dead end. That is, this is the scenario of internal cataclysm which will be used by external enemies for their advantage: as by close neighbors (Iran) and by far ones (Russia). Earlier it was talked about the threat of the Saudi-Iranian war, instability in Yemen. It was talked a lot about this, but this has not happened.

However, Russia and Iran are working on the scenario of destabilization of Saudi Arabia with subsequent collapse. Even if we assume that they succeed, there will be a jump in prices. But the collapse of the Kingdom would have had the apocalyptic impact on the oil market 10 years ago. Now the market might be destabilized for a year or a year and a half, but it will be soon normalized due to surplus in oil production capacities.