Russia: Production Cuts Are Needed To Stabilize Oil Markets

The key question is how quickly and by how much,” said one source familiar with the talks between Russian oil firms and the ministry

The key question is how quickly and by how much,” said one source familiar with the talks between Russian oil firms and the ministry

According to Reuters, Moscow intends to reduce oil production gradually, and at the moment it is trading with Saudi Arabia with respect to time and volume reduction.

Oil slipped on Wednesday, pressured by rising US inventories and doubts over whether an OPEC-led output cut will be agreed next week. -China trade war a key focus.

Russian oil companies Rosneft and Gazprom Neft declined to comment.

Crude oil price remained in a major downtrend and it recently traded below the $53.00 and $52.00 support levels. The price also broke a crucial bearish trend line with resistance at $51.15 on the hourly chart.

In the current environment, the kingdom must do everything possible to prevent another price crash, which means it has little option but to cut its own production significantly. It tested the broken trend line, the 50 hourly SMA, and the 38.2% Fib retracement level of the recent wave from the $49.49 low to $52.21 high.

After reaching a four-year high in early October, crude has collapsed more than 30 percent, marking the worst crash since 2015.

ANZ bank said on Friday that oil prices were rebounding "as signs that OPEC+ was moving closer to an agreement around further production cuts".

"It is against this backdrop of the oil market looking rather oversold, that OPEC's decision needs to be viewed".

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In public and private, the president has told the Saudis he wants cheaper crude, even disclosing that he berated MBS in a phone call in October when worldwide benchmark Brent surged above $80.

"Even if Russian Federation and Saudi Arabia reach an agreement at the G-20 to decrease output", other countries might respond by increasing their output, Kocaman said.

Saudi Arabia is in talks with various oil producing countries to address the volatility in the global crude oil market.

Russian President Vladimir Putin will meet Prince Mohammed in Argentina at this weekend's G20 summit, which Trump is also to attend. In which case a significant cut of, say, 1 mb/d could lead to a rapid recovery in prices.

He said at the time that supply could exceed demand by as much as 1 million barrels per day (bpd), or 1 percent of global demand, suggesting that OPEC and its allies may try to reduce production by that amount.

Russian President Vladimir Putin, whose country is the world's second-biggest oil producer, said on November 28 he was in touch with OPEC and ready to continue cooperation on supply if needed, but he was satisfied with an oil price of $60.

But the USA also offered generous waivers to allies who imported Iranian crude and might have struggled to find other supplies quickly when United States sanctions kicked in on November 4.

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