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Venezuela presses Russia on OPEC price cooperation

CARACAS (Reuters) - Venezuelan President Hugo Chavez pressed his Russian counterpart on Wednesday to cooperate with OPEC to help save “battered” oil prices, but won no public concessions from the leader of the energy giant.

Venezuelan President Hugo Chavez (R) welcomes his Russia's counterpart Dmitri Medvedev at Miraflores Palace in Caracas, November 26, 2008. REUTERS/Jorge Silva

“We have discussed the theme of energy, oil and the need to continue maintaining and strengthening cooperation inside OPEC and outside OPEC, OPEC with Russia, to save the prices of our oil, to recover the price,” Chavez said at his palace, hosting Russian President Dimitry Medvedev at his side.

Chavez is a price hawk within OPEC and pushing for the export group to cut oil output to dampen supply in an effort to lift crude values that have fallen almost $100 since July.

The socialist, whose government relies on oil for about half its income, has strengthened ties this year with Russia, helping to boost Moscow’s cooperation with OPEC.

Russia has worked more closely with OPEC in recent months and has agreed to cooperate with the group to study market movements. But it has stopped short of committing to any kind of coordinated supply cut.

Medvedev, who said oil’s low price was worrying, maintained that Russian position.

“We are ready for discussions and coordination on the oil market with OPEC countries but this does not mean we are going to arrange a closed club,” he said. “We are talking about responsible actions by key players on the energy market.”

“Of course, we are concerned about the oil prices. These prices cannot be too low nor speculatively high,” he said.

Increased cooperation between OPEC, which accounts for about a third of world oil supply, and Russia, one of the world’s top energy producers, has concerned consumer nations that they may act together to exert control over the market.

Chavez has called on OPEC to set a target price band of between $80 a barrel and $100 a barrel, a proposal Medvedev said was interesting.

Russia’s Deputy Prime Minister Igor Sechin told reporters that Russia has handed OPEC a draft proposal for an accord on areas of cooperation with the export group. An OPEC response could emerge at an OPEC meeting next month in Algeria, he said.

On a tour through Latin America, Medvedev visited Venezuela to strike deals on oil, nuclear energy and airline cooperation. On Thursday, he and his anti-U.S. host will oversee joint navy exercises involving Russian warships that recall Cold War maneuvers.

Writing by Saul Hudson; Editing by Gary Hill and Ben Tan

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