Russia did not want to trigger a collapse in oil prices: Official

Russia did not want to see a sharp drop in the price of oil, the country’s First Deputy Prime Minister Andrei Belousov said, according to state news agency TASS.

Oil prices have plunged dramatically since early March after Russia failed to agree with the Organization of Petroleum Exporting Countries (OPEC) on additional production cuts. In response, producers have begun escalating production in a price war for market share that has seen oil prices fall by around 50 percent while demand has dampened due to the coronavirus pandemic.

“The Russian position has never been to collapse oil prices,” Belousov said.

He went on to blame Arabian Gulf states for the collapse in prices noting they “behaved differently.”

On Friday, Igor Sechin, CEO of Rosneft, Russia’s top oil producer, said, “I have no doubts that contact should continue. These two (Russia and Saudi Arabia) are the largest oil producers, and of course, we need to cooperate, to exchange information.”

Sechin had been publicly opposed to the three-year output deal that OPEC, Russia, and others had been committed to.

Last Wednesday, a report from Rystad Energy estimated that oil demand for 2020 is set to fall 2.8 million barrels per day. The revised estimate in oil demand slowdown, which was in the hundreds of thousands last week, is due to the rapid spread of coronavirus, officially known as COVID-19, and the subsequent lockdowns across Europe and declaration of a state of emergency in the United States, the report said.