Putin and Saudis plead with Opec allies to press ahead with oil supply cuts

mbs and putin

Vladimir Putin and Mohammed bin Salman have both agreed to curb their countries’ oil output to help raise prices – AFP via Getty Images

Vladimir Putin and the leader of Saudi Arabia have urged members of the Opec+ oil cartel to follow through with an agreement to cut supplies as oil prices plunge.

The Russian president and Crown Prince Mohammed bin Salman said other countries joining its agreement to reduce output is in the interests of the global economy.

A joint statement was published on Thursday after the two leaders met in the Gulf state amid plummeting oil prices.

Brent crude, the global benchmark, climbed back above $75 a barrel after slumping by 11pc over the previous five sessions, the longest run of daily losses since February. It was priced near $100 in September.

Prices dropped as traders doubted the level of commitment to the voluntary pledge made by members of the Opec+ group last week to reduce supplies.

The joint statement read: “In the field of energy, the two sides commended the close cooperation between them and the successful efforts of the Opec+ countries in enhancing the stability of global oil markets.

“They stressed the importance of continuing this cooperation, and the need for all participating countries to join the Opec+ agreement in a way that serves the interests of producers and consumers and supports the growth of the global economy.”

Following last week’s Opec+ meeting, Saudi Arabia agreed to extend its voluntary oil output cuts of a million barrels per day (bpd) into the first quarter, while Russia said it would continue to curb oil exports by 300,000 bpd and additionally reduce its fuel exports by 200,000 bpd from January to March.

The total cuts to global supplies amount to 2.2 million bpd from eight producers, the oil cartel said in a statement after the meeting.

However, not all Opec+ members – made up of the core Opec group and several allies – agreed to extend or deepen the voluntary oil cuts.

Opec+‘s output of some 43 million bpd already reflects cuts of about five million bpd aimed at supporting prices and stabilising the market.

Citigroup analysts Max Layton and Francesco Martoccia wrote in a note: “The market has proved to be very disappointed in the Opec+ measures.”

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