Russian President Vladimir Putin said Wednesday that he had sealed a pact with the country’s oil majors to freeze production as proposed last month by Moscow and Saudi Arabia to curb slumping prices.
“Yesterday we met with the management of our leading oil firms, and on the whole an agreement has been reached that we will keep the level of oil production in 2016 at January’s level,” Putin was quoted as saying by Interfax.
Saudi Arabia and Russia — two of the world’s biggest oil producers — proposed after a February 16 meeting with Qatar and Venezuela that all producer countries freeze their output at January levels to support prices, provided that other major producers followed suit.
Putin gave no indication on Wednesday over the details of the agreement and whether Russia would freeze output even if other countries refused.
The news of the February proposal sparked hopes the market would stabilise after sinking to near 13-year lows last week on the stubborn supply glut — but disappointed those looking for an output cut.
Despite Iran’s refusal to play ball, oil prices have significantly recovered since, supported by the announcement of a new meeting in mid-March between Russia and OPEC members Qatar, Venezuela and Saudi Arabia.
The collapse in oil prices has plunged Russia, which is already subject to Western sanctions imposed over the Ukraine conflict, into a recession which is extending into a second year.