OPEC invites Russia to meeting, eyeing higher oil price

ISTANBUL — OPEC said on Wednesday it was inviting Russia and other key non-members to a meeting later this month as the oil cartel and Moscow seek to tighten cooperation to boost historically low crude prices.

The announcement came after a meeting in Istanbul between several top OPEC energy ministers with their Russian counterpart Alexander Novak aimed at advancing joint efforts to bolster oil prices whose lows have hurt the highly-dependent economies of crude producers.

The meeting took place on the sidelines of the World Energy Congress in Istanbul, which on Monday saw a vow by Russian President Vladimir Putin for Moscow to impose curbs on energy output to match OPEC cuts that caused a spurt in oil prices.

“We agreed to have a technical meeting of OPEC... on 28-29 of this month [October]. An invitation is going to be sent to some key non-OPEC countries,” Qatar Energy Minister Mohammed Saleh Al Sada said after the talks.

“This meeting is meant to give a better understanding of the best way of how to move towards the rebalancing of the market to the interest of all,” added the Qatari minister.

Other than Russia, he did not elaborate on what other non-OPEC countries were being invited to the meeting, but indicated he wanted a wide turnout.

“We have a list of non-OPEC countries and we are yet to refine it further. We intend to expand it and get the feelings of as many non-OPEC countries as possible.”

He gave no indication however the meeting would be attended by the United States, the world’s number three oil producer.

“The US attending is something we cannot assure you of,” he said.

‘Cooperation roadmap’ 

The prospect of Russia, one of the world’s top two oil producers alongside Saudi Arabia, coordinating policy with OPEC has boosted global oil markets in the last few days and briefly brought crude to its highest levels for a year. 

The cartel had last month at a meeting in Algiers agreed its first production cut in eight years, although it remains to be seen how this will be complied with and implemented.

Novak confirmed that Russia had been invited to the October meeting in Vienna which would try and “work out a roadmap for the cooperation of our countries” in the rebalancing of prices. 

The upcoming talks will be a technical meeting, with the next general meeting of OPEC ministers planned for November 30 in Vienna. 

Novak had on Tuesday evoked a possible six month freeze of production levels by Russia to match OPEC’s own output curbs.

He said no concrete figures were discussed at the meeting. “As for figures, that is in the future and and I think [at the October meeting] we will discuss more or less concrete parameters.”

Putin said Wednesday in Russia that a freeze of production at current levels was in the interest of the Russian economy.

“If OPEC countries agree a production freeze, we will join that decision,” he said, adding the key obstacle was to find agreement between Saudi Arabia and its regional foe Iran.

‘Rebalance the market’ 

The energy ministers of OPEC members including United Arab Emirates Energy Minister Suhail Al Mazroui, Qatar Energy Minister Mohammed Saleh Al Sada and Venezuelan Oil Minister Eulogio del Pino all attended the talks at an Istanbul hotel chaired by OPEC Secretary General Mohammed Barkindo. 

Of non-OPEC countries, Mexico was also represented.

However, there were notable absentees from the talks, with the energy minister of the cartel’s Saudi Arabia, Khalid Al Falih, having already departed from Istanbul and Iraq and Iran also not attending. 

Al Falih had also made clear at the congress earlier in the week that Saudi Arabia was against any drastic output cuts by OPEC, warning the cartel not to “crimp too tightly”.

Oil prices had plunged to historic lows over the last two years with an excess of supply, partly due to new and cheaper technologies coming at a time of a global economic slowdown.

“We are doing our very best now to rebalance the market,” said the Qatari Minister Al Sada, adding that the current “overhang” in excess supply was holding back much-needed investment.