Putin: Russia ready to join OPEC production cuts

ISTANBUL, Oct 10 (PRIME) -- Russia is ready to join OPEC in a freeze of oil production, if such an agreement is reached, President Vladimir Putin said on Monday.

“It will not violate work of market mechanisms, but on the contrary it will allow the market to reach a balanced state faster,” he told a World Energy Congress.

He is sure that the organization will be able to reach the agreement in November. “We support the recent initiative of OPEC to fix production limits, and we expect that OPEC will be able to transform this idea into agreements and provide a positive signal to markets and investors,” Putin said.

A long period of high oil prices led to an overproduction of oil, but the plunge of a price has translated into the lack of investment, which may become a chronic problem and lead to a deficit of oil and unpredictable changes in prices. This is why a freeze or even a cut of oil production is possibly the only viable solution to support the international energy industry, he said.

There is no reason to speak about an upcoming era of hydrocarbons, he said.

“Many people have said that the era of hydrocarbons is coming to an end as the oil prices have plunged by more than two times, and that we should completely reorient to alternative energy sources. I think that there is no real reason for such far-reaching conclusions. At least now,” he said.

Consumption of oil and gas is still growing, albeit not so fast as before. “Demand for traditional energy sources is supported not only by a higher number of cars and better electrification of such large economies like China, India and some other states, but also by an expansion of products of petro- and gas chemistry into all spheres of human lives and into industrial processes,” he said.

The world’s interest in purchases of liquefied natural gas (LNG) will grow, and LNG sales will top traditional supplies through pipelines in 10 years, he said.

Unilateral sanctions, unjustified restrictions of access to investment resources and cutting edge technologies to please political ambitions of some countries are inacceptable, he said. “It will not provide a result that would satisfy the initiators of the measures,” he said.

Russia remains a reliable supplier of energy sources to the global markets. “Exports of Russian energy sources ensure successful operation of many economies of the world. Our oil and gas already account for more than a quarter of the fuel balance of the E.U.,” he said.

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