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Russia's Sechin says wants smooth future exit from global oil deal

Reuters  |  SOCHI, Russia 

By Denis Pinchuk

SOCHI, (Reuters) - Igor Sechin, the head of Russia's largest producer Rosneft, said on Wednesday once the global deal to cut production expires, it should be ended in a way to avoid causing price volatility.

He said he had asked Russian Energy Minister Alexander Novak to negotiate a smooth exit mechanism with and the other leading producers party to the output cut agreement.

Saudi Arabia and Russia, the world's top two producers, have agreed on the need to extend output cuts for a further nine months, until March 2018, to rein in a global glut.

"We have asked our minister to agree with partners such a mechanism within the framework of this deal so that the exit from it, once it expires, would be quite smooth and won't lead to serious volatility," Sechin, a long-standing ally of President Vladimir Putin, told reporters.

He said the "information about the agreement extension has already had an impact on the market, the price has corrected up", adding the main objective of the deal was to stabilise prices by the end of the agreement.

The deal between the Organization of the Petroleum Exporting Countries and other leading producers, including Russia, foresees combined production cuts of almost 1.8 million barrels per day in the fist six months of 2017.

ESSAR

has been struggling to complete its $12.9 billion acquisition of India's because six of Essar's Indian creditors have yet to approve the deal, sources close to the talks said.

played down the difficulties with the deal.

"When you are engaged in deals, you'll understand what it is. When there is a group of participants, there are banks. Proceedings should be agreed with all of them," he said.

"It would be quite quick," he responded to the question about the completion of the deal.

has said it was expected to be completed by the end of June.

"There are several participants, there is a need to obtain anti-monopoly approval, other authorisations ... The deal is not simple, everything will be normal, this is a good project," said.

(Reporting by Denis Punchuk; writing by Vladimir Soldatkin; Editing by David Evans)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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