OPEC Secretary General Hints At Cuts In Russian Oil Production

OPEC Secretary General Ali Rodriguez-Araque has made it clear that Russia will make "proportional" cuts in its daily output of oil. Rodriguez announced in Vienna on Friday that Moscow had taken up an "entirely realistic position" in relation to stability on the global fuel markets and maintaining crude prices. The OPEC secretary general did not indicate the level of the proposed Russian cuts. However, he did not rule out that Moscow would follow Oslo and Mexico's example by reducing output to 100-200,000 barrels per day. According to Rodriguez, if three non-cartel oil producing countries (Russia, Mexico and Norway) were to cut their daily output, then OPEC could be able to implement a decision taken at its extraordinary 118th Vienna conference on reducing crude extraction and export quotas by 1.5 million barrels per day on January 1st as planned. Meanwhile, Rodriguez believes that in spite of all the efforts, which OPEC is making, as well as those undertaken by Russia, Mexico, Norway and Oman, the "optimum" price per barrel, i.e. 25$, is not likely to be reached any time soon. Rodriguez predicted that this price will probably remain at the bottom of the earlier drawn up corridor, 22$ per barrel.

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