Putin: Current Oil Prices Acceptable, OPEC+ Alliance Effective

In a possible sign that Moscow is willing to bend when the world’s biggest oil exporters gather this week in Vienna to discuss supply curbs, Russian President Vladimir Putin has called current oil price levels “acceptable”, Reuters reported.

The OPEC+ alliance between the Saudi Arabia-led Organization of Petroleum Exporting Countries (OPEC), and other big producers including Russia, created as an effort to control prices, has come under pressure in recent months as the effects of the coronavirus outbreak pummel oil demand and prices.

Putin also said Moscow was approaching a so-called OPEC+ meeting this week in Vienna as an “instrument for long-term stability”.

Reports last week quoted sources saying some influential OPEC members, including Saudi Arabia, were likely to call for a larger-than-expected reduction in oil output by the group as the global spread of coronavirus and related effects slow economies and depress international demand for oil.

But Russia was said to be resisting further curbs too far beyond an existing deal that has kept a lid on demand through the end of March.

“I want to stress that for the Russian budget, for our economy, the current oil price level is acceptable,” Putin told Russian energy officials and producers gathered in Moscow to discuss the coronavirus and its implications on March 1.

He said Russia’s budget assumes an average Brent crude price of $42.40 a barrel for supplies from the estimated $560 billion in oil reserves under Russian territory.

Russia’s economy has recovered significantly from a downturn that followed its 2014 invasion and annexation of Crimea from Ukraine and a falling-off of oil prices around the same time, prompting painful measures that dented Putin’s popularity well into his fourth overall term as president.