Russia and Saudi Arabia want to extend oil production agreement

Russia and Saudi Arabia have agreed on a six-to-nine-month extension of the agreement to cut oil production between member and non-OPEC countries, Vladimir Putin said on Saturday.

The Russian President, who spoke after a bilateral meeting with Saudi Crown Prince Mohamed bin Salman on the sidelines of the G20 summit, said the agreement would be extended in its current form and on the same volumes.

The existing agreement is for a reduction in production of 1.2 million barrels a day. It is due this Sunday.

The countries of the Organization of the Petroleum Exporting Countries (OPEC), Russia, which is not part of it, and other producing countries, linked in the framework of the OPEC alliance, have to meet on the 1st and 2nd of July to discuss the details of the agreement.

“We, Russia and Saudi Arabia, will support an extension,” said Putin. “As for the length of this extension, we still have to decide whether it will be six or nine months.”

According to Kirill Dmitriev , managing director of the Russian Direct Investment Fund, the pact in force since 2017 has allowed a stabilization of oil prices and, in fact, an improvement of the order of 110 billion dollars of the revenues that the State Russian emerges from the production and sale of oil.

Since the beginning of the year, the price of Brent, the benchmark, has gained 25%. But the slowdown in global economic growth as well as the rise in US crude output could weigh on prices.

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