Russia and Saudi Arabia said on Friday they believe a deal is possible to gradually boost oil output from as soon as July as world oil prices have recently hit highs last seen in 2014.
Meanwhile, President Vladimir Putin said on Friday that Moscow would be satisfied with the price of crude oil dropping to $60 per barrel, from its recent level of around $80.
Russia and Saudi Arabia are the key movers behind a pact between OPEC and other producers that has limited production since 2017 but which experts fear may soon lead to a spike in prices.
Saudi oil minister Khaled al-Faleh said at an economic conference in Russia that a gradual output increase could happen in the second half of the year to prevent any supply shocks, according to the RIA Novosti agency.
His Russian counterpart Alexander Novak said they had discussed whether they need to ease production limits.
“If we come to a common opinion that it is necessary” to increase supply it “should probably take place from the third quarter,” Novak said, according to RIA Novosti.
Talks next month
He said ministers from OPEC and other members of the production pact would discuss by how much to increase production next month.
“It is too early to discuss a concrete figure,” said Novak.
Their comments sent oil prices tumbling by over three percent. Brent Crude fell to $76.43 per barrel and WTI Crude to $68.03 around 1545 GMT.
OPEC and 10 other oil producers agreed at the end of 2016 to cut output by 1.8 million barrels per day to clear a glut that had led to a collapse in prices in 2014.
The deal, which has been extended until the end of 2018, has led to that glut disappearing and prices recovering from around $30 per barrel when it first went into effect.
Uncertainties about supplies from Iran and Venezuela have led prices to spike higher in recent weeks, with industry players warning they could jump to $100 per barrel.
Putin said that Moscow sees $60 per barrel as the price which balances supply and demand, and where exploration and development of additional resources can take place.
“We would be completely satisfied with oil at $60” per barrel, Putin said in televised comments.
He noted that a higher price can hurt consumers and spur production in rival nations.
While higher prices were boosting revenue into the Russian budget, Putin acknowledged that “It isn’t in our interest that oil prices continue to rise.”
Novak was later quoted as saying by Interfax news agency that any increase in supplies would be gradual.
“Our objective is to avoid destabilizing the oil market and not overheat it,” he said.