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British radio station Share Radio had a Q&A with oil markets expert, Trend Agency’s deputy director, Vagif Sharifov, about the situation in the oil market and its influence on the world countries’ economies.

How are the oil markets doing this morning (including price)?

Most of the oil expert society now follows the message ‘Welcome to the return of normal oil prices’. It comes from the continuously declining oil prices, month by month, without any visible limits. So February futures for the WTI stand at $47 per barrel, while Brent is at $50. Brent prices fell below the five-year average in early September and slipped well below the five-year range in November and December. WTI prices have been below the five-year average since early October and below the five year-range since early November.

Crude oil prices fell sharply in Q4 2014 as robust global production exceeded demand. After reaching monthly peaks of $112 per barrel and $105 per barrel in June, Brent and WTI fell to $62 and $59 in December.

Does the drop in oil price help the world economy or any country's economy?

It helps the US, at least because of declining of gasoline prices. These days the average gasoline prices in the US have fallen below $2 per gallon in most parts of the country. That obviously has boosted the U.S. car sales.

During this year the US will be the only country which plans to increase oil supplies more than other world countries. The US will increase the supply of oil by 7 percent to almost 15 million barrels per day, when all the other producers will increase it in average by 1 percent, while many producers will decrease them slightly.

So the share of US oil in the world balance of oil is going to be exceeded 16 percent in 2015 compared to 15 percent in 2014.

How low could oil prices go and what if they fall to $40 per barrel?

Ali al Naimi, the oil minister of Saudi Arabia - a huge oil producer itself, said that the world may never see $100 per oil barrel again. He said it is not in the interest of OPEC producers to cut their production, whatever the price is. He thinks it is irrelevant to cut the production, whether the price goes down to $40 or even $20.

But the analysts of British economic research and consulting company Capital Economics said in one of their reports that each $10 per barrel fall in oil prices represents a transfer of annual income of around $330 billion from oil producers to oil consumers.

However they think it is likely that euro-zone inflation will turn negative in the coming months, and $40 oil would pretty much guarantee that result.

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