Russia is not to blame for a global glut in oil that has caused prices to slump over the last 16 months, and the country's energy minister pointed the finger at U.S. shale oil producers and the Organization of Petroleum-Exporting Countries (OPEC).
A glut in the supply of oil and lack of demand has caused global oil prices to fall from a high of $114 a barrel in June 2014 to currently trade around $50. Despite the fall in prices, the 12-member oil producer group OPEC has not reduced output (and has even increased production),
in a move seen as part of a strategy to defend its market share in the face of competition from U.S. shale oil producers.
Russia, which is not a member of OPEC, has also not reduced oil production in a bid to support prices, but Russia's Energy Minister Alexander Novak was clear that his country was not to blame for the supply glut.
"The gas and oil industry is one of the most important industries in Russia…(But) with respect to Russia's export influence on global markets in the past years, we have maintained our output rate pretty much unchanged over the past three to four years, but we have witnessed a lot of inflow, of a lot shale oil from the United States," Novak told CNBC Tuesday.
"The U.S. alone has been responsible for an additional five million barrels a day, which is a large amount and the market hasn't been able to process this huge quantity of oil."
"In my view, therefore, there are two factors that influenced overproduction: very high rates of growth in shale oil extraction and an increase in production by OPEC countries that over the past year have increased production by 1 million barrels a day - that's a huge number for a market that normally grows, on average, by 1 million barrels a day per annum."
The minister was keen to point out, however, that Russia had no interest in driving U.S. shale producers out of business.
"Definitely, no one has such goals because it is all market competition, and in fact, there are a lot of countries in the world extracting and exporting oil – countries that used to import oil now have domestic production, so buy less from the market."
"I want to stress again that Russia does not exert pressure on the market with any additional supply on its part."
Novak's comments come amid speculation that Russia and OPEC could meet to discuss co-operating on lowering production. Russia and Saudi Arabia, the de facto leader of OPEC, have met recently to discuss oil prices and plans are afoot to "bring together OPEC and non-OPEC countries" in October, Novak said.
"Doubtless, we (will) speak a lot about the current market situation and the prices and about our projections, but we (will) also talk about output supply and demand. These discussions that have been going on for almost a year now," Novak said.
Novak said that some OPEC members had proposed an initiative to reach greater coordination in terms of adjusting output to balance supply and demand but "as far as the Russian Federation is concerned, we don't think adjustment is an efficient means, because it is purely a short-term measure, and in the future it will result in a greater mis-balance of the oil market," he said.