The Organization of Petroleum Exporting Countries (OPEC) and non-OPEC members have met in Istanbul to attend the 23rd World Energy Congress and to hold an unofficial OPEC meeting. Oil producers are seeking to ways to limit oil output level since their economies have been damaged by extra-low oil prices. According to leaders speaking at the congress yesterday, low oil prices not only damage the producers' economies, but also discourages investors to make new investment plans, which will harm supply security in the long term.
Russian President Vladimir Putin raised the alarm, saying that if the current trend of low prices continued, it could lead to a "chronic" lack of financing in the sector which could in turn lead to unpredictable flare-ups in prices.
"Russia as a prominent energy power will always make its contribution to stable development," he said, insisting that even in the current difficult times Russia was still investing in oil extraction.
President Putin on Monday said non-OPEC member Russia was ready to join measures to limit oil production, saying that this was the only way to balance the market after a prolonged period of low prices.
"In the current situation, we believe a freeze or a cutting of the production of oil is the only way preserve the stability of the energy sector and accelerate a rebalancing of the market," he said at the World Energy Congress in Istanbul. "Russia is prepared to join joint measures limiting production and calls on other exporting countries to do the same," he added.
He expressed hope this would lead to a concrete agreement at a November OPEC meeting and that this idea would be a "positive signal to the market and investors."
The period of low oil prices has been hugely damaging to economies like Russia, which has failed over the last years to reduce its dependence on hydrocarbon exports for revenues.
Venezuelan President Nicolas Maduro also called for fairer oil prices to help producers yesterday, saying OPEC and states not aligned with the cartel needed to create a "new mechanism" to ensure the price of oil was propped up.
Speaking at the World Energy Congress in Istanbul, Maduro said an informal meeting of cartel members tomorrow was also expected to include non-OPEC state Russia could be a first step towards creating a new alliance.
The price of crude has recovered in the last days but the recent period of low oil prices has been deeply hurtful for producers like Venezuela who are heavily dependent on crude exports.
"Prices are not sustainable anymore and have fallen to their lowest levels for the last 40 years," Maduro said.
"We see they are even below production costs."
"Prices must be fairer and more realistic.... for investment we need fair prices."
Referring to the upcoming OPEC talks tomorrow he expressed hope that "the energy ministers can reach an agreement and through this agreement we hope there can be an alliance among producers.
"If there can be let it be formed. For the market to have stability we are ready to do everything, hopefully in the next six months we will come up with a new mechanism... We need a new mechanism. The oil world needs realistic and fair prices." Quoting his predecessor Hugo Chavez, Maduro also railed against the "insatiable imperialist vampires" and said, "we need to fight against them in energy and politics."