MOSCOW — The world’s two largest oil producers, Russia and Saudi Arabia, on Monday agreed to act together to stabilize global oil output, though it’s unclear what that might entail.
Energy ministers Alexander Novak and Minister Khalid al-Falih met Monday on the sidelines of the Group of 20 nations’ summit in China. A joint statement released by Russia said both ministers “recognized the need to restrain an excessive volatility of the oil market” and agreed to act together “in order to stabilize the oil market.”
Novak and al-Fatih said they would chair the first Russia-Saudi task force on oil and gas in October.
Russia, which is not a member of the oil producing nations’ group OPEC, this year supported calls to freeze production, but the efforts fell through after OPEC member Iran opposed the plan.
It was not clear from the joint statement what exactly Russia and Saudi Arabia would be prepared to do to help prop up the markets but the Russian minister mentioned a production freeze.
“We believe that the market right now is taking too long to balance out, it’s been two years, and joint steps which were considered earlier this year including a production freeze could be a great help in helping to balance the markets as soon as possible,” Russian news agencies quoted Novak as saying.
Speaking to reporters after the meeting, al-Falih, the Saudi minister, said in comments carried by the Interfax news agency that the freeze “is not the only solution” but refused to elaborate.
The price of oil jumped on the countries’ statement. The U.S. contract rose 2.2 per cent, or 99 cents, to $45.43 a barrel in electronic trading on the New York Mercantile Exchange.