Russian Oil Minister Alexander Novak (left) arrives for a meeting with his Saudi counterpart in Riyadh on October 23, 2016. Saudi Oil Minister Khalid al-Falih said that the current down cycle of crude prices is close to an end as market fundamentals improve. “The current down cycle is nearing an end,” Falih told a joint press conference with his after a Gulf ministerial meeting in Riyadh. AFP
CAIRO, Egypt — Russia’s oil minister signaled possible cooperation with Saudi Arabia at a meeting with his Gulf Arab counterparts in Riyadh on Sunday, as the kingdom seeks to convince major oil producing countries to cut production in order to increase prices.
After the meeting in the Saudi capital, Russian Oil Minister Alexander Novak was quoted in a ministry statement as saying that the parties had discussed specific production limits for Russia and other nations that may join the agreement, although he did not mention any figures or commitments from Moscow.
“We see the need to balance the market in the coming months to encourage the return of investments and the reduction of volatility,” Novak said.
In a statement, Saudi Oil Minister Khalid Al-Falih also mentioned the need to “restore balance” to the market, where a surge in production globally has led to low prices that have weakened state coffers including that of the Saudis, currently engaged in a costly war in Yemen.
The Vienna-based Organization of the Petroleum Exporting Countries last month agreed to reduce daily output to between 32.5 million and 33 million barrels, sending the price of crude up about 15 percent. The cartel is seeking help from countries who are not members, such as Russia, to join in its efforts to curb supply.
Oil production from OPEC nations hit a record last month, although members have agreed to come up with a plan to reduce it before a meeting on Nov. 30 in Vienna, before which Novak said negotiations would continue.
The Russian position could signal a rare bright spot in its recent relations with Saudi Arabia. The two countries are adversaries in the Syrian civil war, with Moscow supporting President Bashar Assad and Riyadh aiding rebels who seek his overthrow. Russia is also close to Saudi nemesis Iran. CBB