Putin says Russian oil companies agree to freeze output

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Photo Courtesy: Gazprom

Russian oil companies have agreed to not raise their production this year and freeze the output at January levels, President Vladimir Putin said, days after major oil producing nations struck a preliminary deal on freezing production.

“We met the management of our oil companies. An agreement was reached at large that we will keep 2016 year oil production level at the level of January of this year,” Tass quoted Putin as saying.

“The point is not to boost our oil production this year,” Putin said in his first comments on the planned production freeze after a meeting with heads of Russian oil companies at the Kremlin.

Oil prices are down more than 70 percent from June 2014, primarily driven by global oversupply exceeding 1 million barrels per day. The Russian economy, which relies heavily on oil and gas revenues, shrank by 3,7 percent last year as prices collapsed.

While Russia, which along with Saudi Arabia, has led the deal on output freeze, uncertainty still persists as Iran is yet to agree. Iran, which is just coming out from international sanctions over its nuclear programme, is keen to raise production.

 

 

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