Official: Russia to cut oil output inevitably if oil prices stay low

MOSCOW, Jan 29 (PRIME) -- The decrease of oil output by Russian companies is inevitable if prices remain low for a long time, Deputy Prime Minister Arkady Dvorkovich told reporters Friday.

"If prices remain at an excessively low level for a long period of time, the adjustment of the investments will be inevitable, and it will cause a reduction in production,” Dvorkovich said.

“But it would not be an intended action of the state, and not in the interests of the state, we are standing for a stable operation of our oil sector."

OPEC said on Tuesday that it will enter into an alliance with Russia and other oil producers in order to boost oil prices, the Telegraph reported.

Dvorkovich said that the Russian oil sector is not under state control and direct regulation is impossible. “The market is regulated by decisions of separate companies. So it will remain.”

The official said that oil prices cannot fall further to a U.S. $20–24 level, “I do not think that we can have to worry that oil prices will be at an ultra-low level on average over the year.”

Oil output decrease will spur growth, he said but it is unclear whether oil production will fall in the U.S., Middle East or in Russia.

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