Putin to Discuss OPEC Oil Production Cut Deal with Saudi King Salman

Russian President Vladimir Putin plans to meet Saudi Crown Prince Mohammed bin Salman when he visits Russia for the opening of the soccer World Cup, Kremlin spokesman Dmitry Peskov told reporters on Wednesday.

Peskov said the two would discuss the global oil production cut agreement which Saudi Arabia and Russia are leading, but an exit from the deal was off the table, TASS reported.

Crown Prince Mohammed is among leaders of many countries who will visit Russia for the World Cup opening, Peskov said.

According to Bloomberg, Russia plans to propose that OPEC and its allies be allowed to return production to October 2016 levels, rolling back most but not all of their output cuts within three months, according to a person familiar with Moscow’s thinking.

All the nations would proportionally share out a 1.8 million barrel-a-day increase to their output limit starting as soon as July, the person said, asking not to be identified because the information isn’t public. The actual boost in supply to the market would be less than that because some states, notably Venezuela, Angola and Mexico, aren’t able to increase, the person said.

Russia and Saudi Arabia, leaders of the group of 24 producers, have already suggested boosting output to stop current prices going any higher. Moscow’s new proposal would go further, effectively ending the cuts for any country that has the ability to pump more crude. Such a move would have to be agreed by other members, several of whom have already come out in opposition, the report said.

The Russia-OPEC oil production cuts deal, which is due to expire at the end of 2018, has succeeded in reducing the oil glut and pushed prices to over $70 (€57) a barrel from less than $30 in January 2016.

Russia is the world’s leading producer of crude oil, pumping around 11 million bpd. Its approval of the alliance is crucial to its success ahead of a key OPEC meeting in Vienna later this month.