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told the UK’s Guardian newspaper. “We believe that the share of natural gas in the global energy mix will only increase. We believe this to apply not only to Europe, but globally too.” According to Novak, the world is far from reaching its “peak in production” of gas, and despite many countries setting renewable energy targets, he thinks the world’s appetite for the fuel will only increase. In addition to increasing its natural gas output, the energy minister also noted that Russia plans to expand its hydrogen production, with its goal of becoming the world leader in its production. “All this has been quite expensive so far, but we believe that just like with renewable energy sources, prices will go down over time,” Novak said.
The Organization of the Petroleum Exporting Countries and Russia are considering deeper oil output cuts early next year to try to strengthen the oil market​, one OPEC source and one source familiar with Russian thinking said on Tuesday, ​Reuters ​informed. OPEC and allied producers, led by Russia, together known as OPEC+, are scheduled to reduce output cuts of 7.7 million barrels per day (bpd) by around 2 million bpd from January. But the impact on energy demand of movement restrictions from the second wave of the COVID-19 pandemic is forcing a rethink. “It looks like we will have to cut deeper in Q1,” the source familiar with Russian thinking said, speaking on condition of anonymity. Producers are “exploring many options beside a rollover (of existing cuts),” the OPEC source said. But the source said a deeper cut would be a “hard call,” as it would hand more market share to producers outside OPEC+. Earlier on Tuesday, Algeria, holder of the rotating OPEC presidency, backed an extension of existing supply cuts. Algerian Energy Minister Abdelmadjid Attar said keeping current cuts into the first half of 2021 could be considered at the next OPEC+ meetings, according to state news agency APS. The second wave of COVID-19 meant the oil market faced a “very dangerous” situation, he said.
9.1.2 ​Automotive sector news
Russia's car and LCV sales (excluding Mercedes-Benz and BMW brands) increased 7% y/y to 154,164 units in October, which brought the YTD decline to 12% y/y​, with 1.2mn vehicles sold, VTB Capital (VTBC) said in a note on November 6.
“The market has been in positive territory since July. In our view, the growth is supported by price concerns amid the ruble depreciation, which might be pulling some demand forward, as well some pent-up demand due to the limited availability of certain models, personal health security concerns amid the rising COVID-19 numbers and the government support, VTBC said. “We believe that these trends are likely to support the market through the end of the year, which makes us more upbeat on the FY20 performance. Our new forecast implies that Russia's car and LCV sales​ (​ including Mercedes-Benz and BMW)​ ​will decrease 7% y/y to 1.6mn in 2020.
104 ​RUSSIA Country Report​ December 2020 www.intellinews.com