BUENOS AIRES: Russia and Saudi Arabia have agreed to extend into 2019 their agreement to manage the oil market – known as Opec+ – although Moscow and Riyadh have yet to agree on any fresh output cuts, according to media reports.
Russia President Vladimir Putin announced the extension after a meeting on Saturday, on the sidelines of the Group of 20 (G-20), with Saudi Arabian Crown Prince Mohammad Bin Salman. The comments open the door for a deal at the Opec meeting next week in Vienna. Opec delegates said the leaders have given their political blessing for an agreement, but plenty of work is left, including on the size of any potential output cut.
“There is no final decision on volumes, but together with Saudi Arabia we will do it,” Putin told reporters about extending the agreement in Buenos Aires. “And whatever number there, will be based on this joint decision, we agreed that we will monitor the market situation and react to it quickly.”
Simultaneously, Saudi Arabia said through its state-owned press agency that Riyadh and Moscow had held talks in Buenos Aires about “rebalancing” the oil market. While both talked about progress and extension of the cooperation, neither the Russian nor Saudis made any formal declaration about output volumes.
“This might be the critical breakthrough for Opec and non-Opec to cut,” said Derek Brower, a director at consultant RS Energy Group. “But the details are now what matter — how much will be cut, from when, for how long and, crucially, from what baselines.”