Vladimir Putin said a cut to global oil production of about 10m barrels a day is possible, but only if all major crude producers including the US join in the reduction pact. The Russian president instructed his energy minister to co-ordinate with Opec and allied producer nations at an extraordinary, virtual meeting to be held on Monday focused on alleviating the supply glut and a response to the coronavirus outbreak. Oil prices have fallen by about half due to the collapse in demand caused by the pandemic, sparking calls, led by US President Donald Trump, for co-ordinated supply cuts to try and bring the market to balance. Russia’s participation is critical to any global agreement. It was Moscow’s unwillingness to participate in a Saudi-led round of production cuts that prompted Riyadh to launch a price war that has seen crude prices drop below $20 a barrel in recent weeks.
Mr Putin’s comments on Friday mark the first time since the talks collapsed that the Kremlin has acknowledged a willingness to re engage on production cuts with Opec. Oil rallied on his remarks, with Brent crude, the international benchmark, settling 13.9 per cent higher on Friday at $34.11 a barrel. “Wecan talk about a reduction in the volume of about 10m barrels per day, a little less, maybe a little more,” Mr Putin said at a meeting of government officials and executives from oil companies. “Of course, all this must be done in a partnership … we are ready for co-operation with the United States of America on this issue.”
His comments come a day after Mr Trump said that cuts of 1om- 15m barrels would be possible, and that he had brokered a deal between Russia and Saudi Arabia to achieve it, an assertion that has been met with scepticism. The US, Russia and Saudi Arabia accounted for about a third of the 100m b/d of crude produced last year.