Moscow and Riyadh are negotiating an oil output freeze deal, Russian Energy Minister Aleksandr Novak said in a statement after talks with his Saudi Arabian counterpart on the sidelines of the G20 Summit in China.
“We have agreed with the Saudi Arabia energy minister on joint action aimed at stabilizing the situation in the oil market. We consider a production freeze the most efficient tool, concrete parameters are being discussed at the moment,” Novak said.
According to Novak, Saudi Arabia is considering capping production for one month, three months or longer.
The world’s biggest producers are considering freezing production at levels of July, August or September of this year, said the Russian energy minister.
Saudi Arabian Energy Minister Khalid Al-Falih called on other big players in the oil market to join the agreement between Russia and Saudi Arabia.
“I have to say all other producers are expressing interest in coordinating… with Saudi Arabia and other like-minded countries to reach a consensus,” Al-Falih said at a briefing with Novak on the sidelines of the G20 Summit.
“We are optimistic the Algiers meeting will provide a forum, and pre-Algiers consultations taking place bilaterally and in groups will bring us to Algiers with some sort of coordinated decisions. But the two countries agree that even if there is no consensus, we will be willing to take joint action when necessary,” he added.
On September 26-28 Algiers will host the International Energy Forum. Venezuela, Ecuador and Kuwait initiated a new round of talks on capping oil production after similar talks failed in April.
As a result of global oversupply, crude prices have fallen from a 2014 high of $114 per barrel to the current price of $45-$50.