Current Oil Markets Situation Could Lead to Future Deficit - Putin

By Staff, Agencies

Russian President Vladimir Putin and members of the cabinet and oil industry officials met via videoconference on Friday to discuss the situation on the global energy markets.

Oil prices suffered their worst decline in decades in March after Russia and Saudi Arabia failed to reach a deal on output cuts amid the ongoing COVID-19 crisis.

“The current slump in demand for oil could lead to shortages in the future when the global economy enters a period of economic recovery,” Putin said.

"Demand will inevitably begin to recover, and a situation of an acute shortage of oil may arise, with all the negative consequences for the world economy [that go with it], because prices may skyrocket," Putin added, speaking to officials and oil industry representatives on Friday.

He also noted that it was the world's common interest to avoid such a scenario.

Today, the situation on energy markets remains difficult, with demand continuing to fall, Putin stressed. “This undermines investments and threatens the workforce, and Russia would prefer long-term stability on the oil market,” he added.

"I want to emphasize that our country has always advocated and is advocating for the long-term stability of the oil market, taking into account the positions of both producers and consumers," Putin said.

The current situation, Putin said, poses not only economic risks, but techno-genic and ecological ones as well. He went on to say that he spoke to American counterpart Donald Trump about the energy markets situation earlier this week, and that both sides expressed concerns.

Putin said Russia would be comfortable with oil prices in the $42 per barrel range, which would allow the country to maintain a balanced budget, and was prepared for joint actions on oil markets to stabilize prices, including willingness to work with the United States on the issue.