Putin announced his readiness to reduce oil production
US, WASHINGTON (ORDO NEWS) — Russia is ready to cooperate with OPEC + countries and the United States on the issue of reducing oil production. This was announced on April 3 at a meeting on the situation in global energy markets by Russian President Vladimir Putin. A transcript of his speech is published on the Kremlin website.
“We are in close contact with our partners in Saudi Arabia. I recently had a conversation with the US President. […] Russia considers it necessary to combine efforts. We were not the initiators of the OPEC Plus deal break. And we are ready for agreements with partners within the framework of this mechanism, and we are ready for cooperation with the United States. […] According to preliminary estimates, I think we can talk about a reduction in the volume of about 10 million barrels per day, a little less, maybe a little more,” he said.
According to Putin, the reduction should come from the level of oil production in the first quarter of this year.
The fall in oil prices has continued since early March. The main reason was that Russia and the Organization of Petroleum Exporting Countries could not agree on new restrictions on the level of oil production. By March 9, the price of Brent oil fell by 30% to $ 33 per barrel, which was the maximum daily drop since 1991, when the Gulf War began. On the evening of March 18, the price of Brent crude fell to a 17-year low of $ 25.4 per barrel, and on March 30, futures traded at $ 18.
Amid unsuccessful negotiations, Saudi Arabia, according to Bloomberg sources, decided to “enter into a total price war” and increase production from 9 to 12 million barrels per day. In addition, Riyadh squeezed out Urals Russian oil from the European market, offering to triple Arab Light deliveries at big discounts.
This led to the fact that by March 31, the price of Urals dropped to a minimum since 1999 – $ 13 per barrel. As noted by Radio Liberty, Urals in Europe has become cheaper than fuel oil.
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