Russia still working on how to freeze oil output ahead of OPEC talks

Wed Nov 23, 2016 10:40am EST
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By Vladimir Soldatkin and Oksana Kobzeva

MOSCOW (Reuters) - Russia has yet to plan how to freeze oil production and there has been no agreement among its leading producers on output curbs, three senior industry sources told Reuters on Wednesday, just days before an OPEC meeting.

Painstaking talks among the Organization of the Petroleum Exporting Countries and the world's other leading oil producers on how to restrict output have dragged on for almost a year without yielding any firm deal.

In September, OPEC agreed to reduce production to between 32.5 million and 33.0 million barrels per day - an effort to prop up prices - from the organization's latest production estimates of 33.64 million bpd.

The pact is expected to be firmed up on Nov. 30 when OPEC holds a regular semi-annual meeting in Vienna, while the group expects other oil producers, notably Russia, to join the freeze.

However, Russia, whose production is dominated by several oil majors, is yet to find a solution on how to limit its output, which in October reached a post-Soviet high of 11.2 million bpd. [O/RUS1]

"The freeze is technically possible, but first of all, the level of curbs should be defined and it should be clear which companies want to take part," a senior industry source, who is not authorized to talk publicly to the media, told Reuters.

"The options (for a freeze) have been discussed," another source said. A meeting among experts from OPEC and some non-OPEC nations is scheduled for Nov. 28 in Vienna and expected to work out details ahead of the Nov. 30 OPEC gathering.

A third source confirmed that discussions were ongoing.   Continued...

The OPEC flag and the OPEC logo are seen before a news conference in Vienna, Austria, October 24, 2016. REUTERS/Leonhard Foeger/File Photo