Baku, Azerbaijan, Oct.24
By Leman Zeynalova – Trend:
Russia will be encouraging OPEC to do as strong the oil output deal as possible in order to boost price, Tom Pugh, the economist at British economic research and consulting company Capital Economics, told Trend Oct.24.
Earlier, Russia’s Energy Minister Alexander Novak said that his country will produce 548 million tons (11 million barrels per day) of oil in 2017, a post-Soviet record, however Moscow still wants global producers to curb production amid weak prices.
“It is likely that Russia is ramping up its oil output prior to the OPEC meeting to be held in Vienna on Nov.30 so that if OPEC does agree an output cut, Russia can say that it will freeze its output,” said Pugh.
“Russia then gets a win-win. If there is no deal, it is already producing large amounts of oil so is in a good position with its market share. If there is a deal, Russia can offer to freeze or even cut a little and benefit from high volumes and higher prices,” he added.
In September, OPEC producers agreed during the informal meeting in Algiers to cut down the oil output to 32.5 million barrels per day (bpd) from current production of 33.24 million bpd.
How much each country will produce is to be decided at the next formal meeting of OPEC in November.
OPEC Secretary General Mohammad Sanusi Barkindo has said that Russia and OPEC are "committed to stable and predictable markets", Reuters reported.
Neither Novak nor Barkindo said at which levels Russia could cap its production, which reached a record-high 11.1 million barrels per day in September.
Novak has repeatedly said Russia would prefer to freeze output rather than cut but would consider specific steps after OPEC members reach agreement.
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