Rosneft Satisfied with Results from Oil Production Cuts

Russia’s oil giant Rosneft PJSC’s has said crude at $70 to 80 a barrel was a “comfortable level” and expressed satisfaction with the results of Russia’s joint supply cuts with OPEC, less than a week before key talks in Vienna that could phase them out, Union News reported.

The producers working together have “restored balance to the market by cutting oil production,” Russia’s biggest oil company said in a statement, citing comments its Chief Executive Officer Igor Sechin made at a meeting in Moscow on Thursday with Saudi Arabia’s energy minister.

“The growth in Brent crude prices to a comfortable level of $70 to $80 per barrel is a result with which we are fully satisfied,” Sechin was quoted as saying. The CEO, a close ally of Russian President Vladimir Putin, had last year questioned the wisdom of prolonging production when oil prices were closer to $60.

Russia will join OPEC and other major producers next week in Vienna to discuss whether to increase production to alleviate consumer concerns about prices and offset supply disruptions elsewhere. The possibility of gradual supply boost has already driven Brent crude down from above $80 to less than $74.

While Sechin didn’t comment on the future of the pact, Rosneft’s smaller rivals, Lukoil PJSC and Gazprom Neft PJSC have recently called for more “flexibility” on output. Both have said that oil prices close to $80 are high enough and may hurt current demand.

Rosneft last month started to test its capacity to bring back production. Russia’s overall output jumped in the first week of June as some companies breached their output quotas.