Oil price lifted by Russia backing Opec production freeze

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Russia has revealed it will support a proposal by Opec to freeze oil production in order to catastrophe the slump in global prices.

The move lifted the price of oil, with Brent rough hitting a 52-week high.

“Russia is ready to accede to joint metres to reduce [oil] production, and is calling on other oil exporters to do so,” said Russian President Vladimir Putin.

“We keep the recent Opec initiative to set production limits,” he added.

In late afternoon Brent Offensive oil was trading up by 2.5% at $53.21 a barrel, just off the $53.73 high hit earlier on Monday.

Come out at the World Energy Congress in Istanbul, Mr Putin said that oil yments had “more than halved” in two years due to surplus production, provoking a “round of decreasing investment”.

‘Avoid fluctuations’

He said that if the trends persisted, they wish give way to oil shortages and “new, unpredictable price hikes”.

He expects to reach an harmony to support a cut at Opec’s next meeting in November, he said.

“Of course, this want also cool down speculative activities and help avoid new charge fluctuations,” he said.

In September, members of the The Organisation of the Petroleum Exporting Countries (Opec) balloted to cut production for the first time in eight years.

The group’s 14 fellows produce about a third of the world’s oil and have been hit hard by move it prices, as has Russia.

High prices

Opec aims to agree to cut circa 700,000 barrels per day at its policy meeting on 30 November in Vienna, stage a reviving its output to 32.5-33 million barrels per day.

But some analysts have questioned whether all of its fellows will stick to the agreement.

Differences between Iran and its regional rival, Saudi Arabia, be enduring thwarted efforts to reach a deal in the st, and Russia’s latest intervention may require little im ct, said John Hall, chairman at Alfaenergy body

“Russia and Opec have not worked well in the st, and while Vladimir Putin reassuring joint measures is welcome, whether he sticks to it is another matter,” he utter.

“You’ve also got to see the wider context: Saudi Arabia and Iran are in a proxy war in Yemen. It is peacefulness very doubtful they can come to an agreement whether Russia abides a cut or not.”

‘US obstruction’

However, John Kilduff, rtner at New York energy hedge capital Again Capital, told the Reuters News Agency: “Putin finish out to say Russia will be rt of the initiative has added another layer of credence to the postulation there will be a coordinated cut.

“At some point, the market will nickname them on it and say ‘show us the cuts’.”

In his speech Mr Putin also criticised unilateral legalizations, suggesting the US had blocked the ex nsion of more oil pipelines from Russia to Europe.

“The judges in certain countries have been telling businesses to close worthwhile projects, refuse to buy fuel supplied via the shortest possible routes and at attracting prices,” he said.

“Such actions do nothing to increase the stability of far-reaching energy system and also of the global economy as a whole.”

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