×

Putin says oil cut deal with OPEC could last to end of 2018

  • Russian President Vladimir Putin said on Wednesday a deal between OPEC and other oil producers to reduce production could be extended to the end of 2018
  • The Russian president's comments raise the prospect of a longer extension than others have mentioned
  • Any move would also require the support of OPEC's de facto leader Saudi Arabia
Vladimir Putin
Alexander Zemlianichenko | POOL | Reuters
Vladimir Putin

Russian President Vladimir Putin said on Wednesday a deal between OPEC and other oil producers to reduce production could be extended to the end of 2018, a longer time frame than others have suggested till now in the bid to curb a supply glut.

The pact between the Organization of the Petroleum Exporting Countries, Russia and other producers on cutting output by about 1.8 million barrels per day (bpd) is now due to expire in March.

"Everyone is interested in a stable market. What we did with OPEC, I believe, is beneficial for all the global economy," Putin told an energy forum in Moscow attended by several OPEC oil ministers.

"When we decide on whether to extend or not, we will decide on the timeframe. But on the whole, if speaking about a possible extension, this should be at least until the end of 2018," he said.

The Russian president's comments raise the prospect of a longer extension than others have mentioned. Saudi Energy Minister Khalid al-Falih and other OPEC ministers have suggested prolonging the deal by months but not until the end of 2018.

The participants have shown confidence that supply cuts since January are starting to erode a glut. With additional help from rising demand, oil prices last week reached almost $60 a barrel, their highest in more than two years.

OPEC ministers attending the Moscow event said they were considering extending the deal or making a deeper cut. The accord has already been extended once at OPEC's last meeting in May, but producers have so far balked at a larger cut.

"It depends on a collective decision and consensus within OPEC, but I think there is no objection against this proposal," Iranian Oil Minister Bijan Zanganeh told Reuters when asked whether there were talks on deepening or extending the cut.

Asked to specify whether he meant no objection to deeper cuts, he replied: "Yes. I'm discussing."

Venezuela's oil minister, Eulogio del Pino, also said there were discussions on whether to cut further or extend the deal.

Any move would also require the support of OPEC's de facto leader Saudi Arabia. Falih said in July that an extension of the agreement would most likely be needed into the second quarter of 2018 as a minimum.

OPEC has been urging other producers to join the supply pact but has yet to secure pledges to do so. Del Pino said an extra 10 to 12 producing countries in South America and Africa had been invited to participate.