Valdai Club

As the world is likely to be moving towards a new geopolitical stage led by health security concerns and more advanced technology, we may well be witnessing a shift away from globalisation towards regionalisation. The prospects of such a shift may mean a greater regional focus on oil trade in the post-corona world, writes Slawomir Raszewski, Research Associate at the European Centre for Energy and Resource Security (EUCERS) in the Department of War Studies, King’s College London.

While the crisis, caused by the spread of coronavirus is not all over yet (and unlikely to be for quite some time), we will be moving along the curve, with experience which may expedite the process of transformation and transition to a new market model, writes Valdai Club expert Slawomir Raszewski.

OPEC’s broader arrangement will depend on compliance with the pledges made by individual countries and application of the production quotas for an extended period of time. Commitment to the agreed production target – in particular, on Saudi and Russia’s part due to the two countries’ production capacities – marks a steady decline of the Organisation.

With OPEC’s global market share losing to non-OPEC producers – including the US shale production which since 2009 has been persistently undermining global oil deal epitomised by the oil cartel – broader arrangements seem inevitable if the Saudi-led bloc aims at rebalancing the market.

Crude oil returns as the key commodity on the global oil markets and, therefore, a closer look is needed to establish what the main challenges and opportunities are.