Russia hopes oil prices will stabilize in the second half of 2017 at around the current level of $55/b and is ready to continue cooperation with the OPEC, President Vladimir Putin said Friday.
“We believe the surplus of oil will be removed from the market and oil prices will stabilize in the second half of 2017. We expect they will stabilize at the current level,” Putin said, speaking at an annual major briefing broadcast on major Russian TV networks.
Putin said Russia’s commitment to cut its crude production by 300,000 b/d over January-June would not have a major impact on the country’s crude output in general, which is at “a high level,” but would allow it to secure significant additional earnings on higher prices reported the Platts.
“An increase in oil prices by $10/b will mean additional earnings of Rb1.75 trillion [$28.41 billion] to the budget and an additional Rb750 billion to companies, despite a cut in their output,” he said.
Following the landmark six-month agreement by OPEC countries to cut their crude output by 1.2 million b/d from October levels, 11 non-OPEC countries led by Russia agreed to join the initiative by cutting their combined output by 558,000 b/d earlier this month. Of this, Russia’s commitment is 300,000 b/d.
Putin added he believed such a cooperation, which “would not be achieved without our deliberate will to work jointly with OPEC,” would be useful for all parties involved.
“We’ll cooperate with OPEC in the future,” he added.