Agreement between Russia, three OPEC countries concerns average oil output for year – Energy Ministry

MOSCOW. Feb 16 (Interfax) – The agreement that Russia and OPEC nations Saudi Arabia, Qatar and Venezuela reached at meeting in Doha on Tuesday not to exceed January’s level of output applies to average figures for the year, not daily output, the Russian Energy Ministry said in a revised statement following the meeting.

The meeting was between Russian Energy Minister Alexander Novak and representatives of three OPEC countries: Saudi Arabian Minister of Petroleum and Mineral Resources Ali Al-Naimi, Qatar Minister of Energy and Industry Mohammed bin Saleh al-Sada and Venezuelan Oil and Mining Minister Eulogio del Pino.

“As the result of the meeting, the four countries Russia, Saudi Arabia, Qatar and Venezuela, are prepared to preserve oil production volume at the January 2016 level on average in 2016 and not exceed it. The decision will be reached if other producers join this initiative,” Energy Minister Alexander Novak stated following the meeting.

The ministry altered the working of an original statement that followed the meeting. Originally, it said the four countries were prepared to “freeze oil production at the level of January if other producers join this initiative.”

Bloomberg earlier quoted Qatar’s energy minister, Mohammad bin Saleh al-Sada, as saying Russia and OPEC ministers agreed at a meeting in Doha today to freeze oil output at January 11 levels.

Daily output in Russia peaked in January.

Oil production in Russia depends on many factors, some of them climate-related.

“In the summer, when oil companies will look at their plans, we will discuss a revision of plans for oil exports,” Nikolai Tokarev, head of pipeline operator Transneft, said following a meeting with Novak in January. It is “not possible to reduce oil production in Russia in the winter, but in the summer there are some options,” he said. “My colleagues confirm that this is technically possible, but only in a warm period. In winter, this is impossible,” Tokarev said.

Nor is it clear whether Iran is prepared to back the initiative. Iran this week supplied its first oil to Europe after sanctions were lifted.