MOSCOW, December 4. /TASS/: The global oil market is currently in a better state than it was two months ago, but it still has many uncertainties, including because of the coronavirus situation in China, Russian Deputy Prime Minister Alexander Novak said on Sunday.
"We stressed today that the market is in a better state than two months ago, although there are many uncertainties. Naturally, we noted that. In particular, they stem from the high inflation levels in many countries, the high level of sovereign debt, and the toughened monetary policy in many countries. Naturally, an important factor is periodical COVID-19 outbreaks in China, the biggest consumer of Russia’s energy resources," he said in an interview with the Rossiya-24 television channel.
According to Novak, the OPEC+ meeting reiterated the decision to cut oil production by two million barrels a day from November. This decision was recognized as the right one geared toward market stabilizing.
Russia not to sell oil under price cap
Russia will not export its oil under the price cap, even if it has to cut production, Novak said.
"We will sell oil and oil products to those countries, which will work with us on market conditions, even if we have to somewhat cut production," he said.
"I would like to stress it once again, our position is unchanged and the Russian president has said that. The government has repeatedly said that it is a non-market, inefficient instrument, which is interfering into market tools and runs counter to all the rules of the World Trade Organization (WTO)," he added.
Russia’s government is looking at a mechanism to ban oil trade under price cap conditions.
"We are not going to use instruments linked with the price cap. We are now looking at mechanisms to ban the use of the price cap instrument, regardless of the limit it sets," he said.
"We think that such interference may entail further destabilization, shortages of energy resources and reduction of investments. It may be applied not only to oil but to other products on the market, and not only to Russia but to other countries as well," he added.
An embargo on shipments of Russian oil to European Union countries by sea comes into force on December 5. Apart from that, EU nations on Friday agreed a regulated price cap on Russian oil shipped by sea at a level of 60 US dollars per barrel. The Group of Seven nations and Australia announced a similar decision.
The United States, the European Union, and the United Kingdom ban their companies from providing transportation, financial and insurance companies to tankers shipping Russian oil at a price above the agreed price cap.
The OPEC+ committee
The OPEC+ monitoring committee will meet again on February 1, Novak said.
"We agreed that the next meeting of the Joint Ministerial Monitoring Committee (JMMC) will be held on February 1, and a ministerial meeting will be held in June 2023," he said.
According to Novak, the OPEC+ nations stressed that in case of necessity the alliance will organize an extraordinary meeting to adjust the market situation. "But there is no need in it right now. We reiterated the decision that were made two months ago," he added.
A source close to the talks told TASS earlier that the OPEC+ monitoring committee will meet on February 1. The monitoring committee embraces eight out of 23 OPEC+ nations, namely Russia, Saudi Arabia, the United Arab Emirates, Iraq, Kuwait, Algeria, Venezuela, and Kazakhstan.
