Russia is ready to consider joining OPEC and other oil producing countries in their efforts on the oil market, Energy Minister Alexander Novak reported.
OPEC agreed to limit oil production in a 32.5-33.0 million barrel a day range, although the level for Iran, Libya and Nigeria has not been defined yet. The agreement is to be formalized at an official OPEC meeting on November 30.
“As we’ve said before, we are ready to consider participation so that our joint actions are taken by OPEC and non-OPEC states. Such consultations were held in February and April. Our position is flexible, as we see the market as unbalanced now, investment has fallen significantly, which bears risks for the future”, Novak said.
The organization will work out measures for stabilization of the oil market in October-November, and non-OPEC oil producers will study them.
“Of course, OPEC members are yet to work out details. The countries will develop suggestions in the framework of the agreements in October-November, and later they will be studied by non-OPEC countries”, he said.
Russia will hold negotiations with OPEC in the period.
The production freeze may be in force for six months, or for up to a year. But Russia is still aimed at keeping its oil production at the current level. In September Russia produced 11 million barrels per day.
“I cannot name a month (in which production level will become the limit for Russia). Even the OPEC states only defined the target output level. All other details of the mechanism for reaching the target level will be discussed later”, he said.
The OPEC agreement is a very positive signal for the whole oil market. Russia saw almost all countries, both OPEC and non-OPEC, wishing to take joint actions to balance the market as soon as possible. Even Iran and Saudi Arabia became more flexible, he said.
Novak said that Russia would be happy with prices in a $50-60 range as they would satisfy both consumers and producer, and would allow companies to invest in future production and development of new fields, he said.
This price level would be the most reliable, but Russia had “adapted to any price that the market saw this year”, he added. (Prime/Business World Magazine)
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