Russia says oil output, exports will be cut by 50,000 barrels a day in 4th quarter of 2001

Friday, November 23rd 2001, 12:00 am
By: News On 6

MOSCOW (AP) _ Russian Deputy Prime Minister Viktor Khristenko said Friday that Russia would cut oil production and exports by 50,000 barrels a day in the fourth quarter of 2001, Russian news reports said.

Russia has been under pressure from OPEC and other major non-OPEC oil producers such as Norway and Mexico to cut production in order to help stabilize the global oil market.

The 50,000 barrel figure includes a cut of 30,000 barrels that Russia earlier had announced, meaning that Friday's decision amounted to a further reduction of only 20,000 barrels a day.

``Considering the current situation, the export and output of oil will be reduced by 50,000 barrels daily compared to the third quarter,'' the ITAR-Tass news agency quoted Khristenko as saying.

He said a further meeting on the future of Russian oil exports in 2002 would be held in December. Oil production and exports have help fuel Russia's economic recovery, and the government has been reluctant to cut production.

The Organization of Petroleum Exporting Countries has agreed to reduce output by 1.5 million barrels a day as of Jan. 1 on condition that non-OPEC members including Norway, Russia and Mexico also agree to cuts amounting to 500,000 barrels a day.

Norway already has agreed to reduce production by 100,000 to 200,000 barrels a day, while Mexico has promised to cut its production by 100,000 barrels a day.

Russia recently surpassed Norway to become the world's second-largest oil producer. Russia has a total production of 7 million barrels a day.

Khristenko made the announcement following a meeting with the heads of Russia's largest oil companies, the Interfax and ITAR-Tass news agencies said.

In a telephone conversation Thursday, Mexican President Vicente Fox discussed the importance of stabilizing the global oil market with Russian President Vladimir Putin.

A statement released by Fox's office did not say whether the two leaders had made any decisions on oil production, but the telephone conversation reflected the dilemma both face amid falling oil prices and a global economic slowdown.

Oil prices have fallen nearly 30 percent over the last two months as a result of a slump in petroleum demand.

According to the statement by Fox's office, he and Putin talked about the ``mechanisms that can maintain a stable situation regarding both production and prices.'' It was unclear exactly what mechanisms the two had discussed, however.

Russian Finance Minister Alexei Kudrin said Wednesday that the government had overestimated the prospects for global economic growth forecast in next year's budget, which risks being thrown off-target by falling oil prices.