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OPEC Sec Gen says keen to extend deal with Russia beyond 2022

A well head and drilling rig in the Yarakta oilfield, owned by Irkutsk Oil Company (INK), in the Irkutsk region, Russia, March 11, 2019. REUTERS/Vasily Fedosenko/File Photo

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Aug 18 (Reuters) – OPEC is keen to ensure Russia remains part of the OPEC+ oil production deal after 2022, OPEC Secretary General Haitham Al Ghais told Reuters on Thursday.

OPEC and its allies led by Russia, have continued to co-ordinate on oil production policy against a volatile political backdrop as Western nations imposed sanctions on Russia for ordering troops into Ukraine in February, which Moscow calls a “special military operation”.

Despite expectations for measures taken to reduce Russian oil supply by the end of the year, Russia is likely to remain part of the charter of cooperation signed between OPEC+ members in July 2019, Al Ghais said.

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OPEC+ is an alliance of the Organization of the Petroleum Exporting Countries (OPEC) and allies.

“We would love to extend the deal with Russia and the other non-OPEC producers … it’s very hard for me to imagine that the deal will not continue,” Al Ghais said.

“This is a long-term relationship that encompasses broader and more comprehensive forms of communication and cooperation between 23 countries. It’s not just in terms of production adjustment,” he said.

Al Ghais, who became secretary general of OPEC this month, added that replacing Russian barrels is “not an easy task” and that lower Russian output would have “severe, severe implications for consumers.” But he was confident that the market will adapt.

“Whatever measures may take place in the future … buyers and sellers can adjust and they can always find ways and mean to reroute and redirect trade flows,” Al Ghais said.

Russia has started to gradually increase its oil production after sanctions-related curbs and as Asian buyers have increased purchases, leading Moscow to increase its forecasts for output and exports until the end of 2025. read more

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Reporting by Rowena Edwards, Alex Lawler, Dmitry Zhdannikov, Maha El Dahan and Olesya Astakhova; Editing by Veronica Brown and David Evans

Our Standards: The Thomson Reuters Trust Principles.

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