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Reuters quotes the Russian Energy Minister Alexander Novak, as he makes some comments on the Russian oil and gas sector tax overhaul and its impact on the country’s oil output.

Key Comments:

Russia should lower oil-industry taxes to bring into production some 10 billion tonnes of currently uneconomic oil reserves.

Russia’s oil output will decline in several years if it does not change taxation.

New taxation should widen the use of profit tax, give tax breaks to exploration, small field development and advanced oil-extraction technologies.

New taxation could boost profit margins by $3-5 per barrel, make Russian oil even more competitive.

New taxation would allow the speedier monetization of Russian oil and gas reserves.

Russia considers mid-term oil price of $50 per barrel as fair, “everyone has forgotten about oil at $100”.

Meanwhile, oil prices are seen advancing in the European session, although the comments seem to have virtually no impact on the oil markets. WTI regain $ 53 mark while Brent nears 59 handle.