MOSCOW (Reuters) - Saudi Arabia plans to raise oil production in November from an October output level of 10.7 million barrels per day (bpd) to meet rising crude demand, the energy minister of the world’s top exporter said on Wednesday.
Khalid al-Falih told a conference in Moscow attended by Russian President Vladimir Putin that the kingdom was in weekly communication with Russia to stabilize global oil markets, which touched a four-year high above $85 a barrel this week.
Oil producers have added a total of about 1 million bpd output in “recent weeks and months” and the global market was well supplied, the Saudi minister said, adding that Saudi Arabia had raised its oil output to 10.7 million bpd in October.
Asked about surging oil prices, Falih said the current price “was not based on fiscal flows of supply and demand”.
“This is created in financial markets,” he said.
Benchmark Brent crude fell 12 cents to $84.68 a barrel at 1125 GMT, reversing an earlier gain. [O/R]
Russian Energy Minister Alexander Novak told reporters before the conference that the global oil market had more or less stabilized but uncertainties remained that could push up prices, including factors such as U.S. sanctions on Iran.
Reuters reported on Wednesday that Falih and Novak had agreed at a series of meetings, held when crude prices were heading towards $80, to lift output from September through December.
The two oil producers struck a private deal in September to raise oil output to cool prices and had informed the United States, which has been pushing for action by OPEC and other producers, four sources familiar with the plan told Reuters.
The private pact was reached before a meeting of oil producers in Algeria.
U.S. President Donald Trump has blamed the Organization of the Petroleum Exporting Countries for high crude prices and demanded that the group boost output to bring down fuel costs before U.S. congressional elections on Nov. 6.
Riyadh planned to lift output by some 200,000 bpd to 300,000 bpd from September until the end of 2018 to help fill the gap left by lower Iranian output due to the sanctions, Reuters reported.
Russian oil output reached a post-Soviet record high of 11.36 million bpd last month.
Reporting by Olesya Astakhova, Dmitry Zhdannikov and Vladimir Soldatkin; Writing by Andrey Kuzmin; Editing by Dale Hudson and Edmund Blair