Russia’s push to increase oil production came independently of tweets by certain political leaders, the country’s oil minister said Saturday during the OPEC summit in Vienna.
“The US is just another consumer, like the rest of consumers, and when we make decisions we take into account the interests of the consumers, not just those of producers,” Alexander Novak told CNBC’s Steve Sedgwick, when asked if tweets by President Donald Trump urging OPEC to keep prices down factored into the country’s move.
“I would like to stress that our offer to increase production volumes in June was made well before the appearance of certain tweets. I’d like to note that Russia had proposed to ease the quotas back at the end of last year, and we began to discuss in detail in February this year,” the minister said.
The comments followed the news that OPEC and non-OPEC members, including Russia, have reached a compliance agreement to raise oil output by one million barrels per day (bpd) in order to balance supply and demand in the second half of 2018.
Russia, the world’s largest oil producer, came to the meeting hoping to put 1.5 million bpd back on the table. But the agreed upon figure should be “sufficient” for the time being, Novak said.
“We have concluded, and I’d like to say it was a consensual decision, that 1 million bpd of easing production cuts at the current stage should be sufficient,” the minister said. “But once again, we are not limiting ourselves to a firm decision. We are getting back together in September to discuss what possible other steps could be needed.”
OPEC ministers announced a deal on Friday that will increase oil supplies from the producer group, which has been capping output in order to balance the market and boost prices for the last 18 months. But the lack of clear output targets left markets confused.
The agreement came after a week of tense negotiation at OPEC’s headquarters in Vienna, Austria. Top OPEC producer Saudi Arabia faced the challenge of convincing a handful of reluctant producers including Iran, Iraq and Venezuela to support an output hike.
—CNBC’s Sam Meredith contributed to this report.
