On the production side, Russian Federation said on Monday it might support an extension of supply cuts that have been in place since January, warning oil prices could fall as low as $30 per barrel if producers supply too much crude. There is a debate obviously within the country about the exact volume that Russian Federation should be producing in the second half."The coalition has yet to decide when it will meet to address the supply accord".
Oil has tumbled from a 2019 peak above $75 a barrel in April to $61 a barrel now on concerns about weakening demand due to a U.S.
Having said all, we would like to note that Russian energy minister Alexander Novak acknowledged the risk of oversupply. "We've agreed that we need to run a deeper analysis and to see how events unfold in June", before making a decision on the future of output cuts with OPEC+.
Many oil exporting countries have confirmed they are prepared to hold a policy meeting with OPEC in Vienna over July 2-4, instead of the scheduled date later this month, Novak said.
Brent crude futures, the global benchmark for oil prices, were down 87 cents, or 1.4 percent, at $61.42 a barrel by 0231 GMT. "We are working to take preventative steps to avoid the scenario that was discussed", Falih said regarding the prospects of prices falling to $30 a barrel, in translated comments.
Oil prices climbed on Tuesday in Asia as market sentiment remained remained firm while expectations that producer cartel OPEC will extend supply cuts underpinned prices.
"Brent futures continue rising. after the Saudi Arabian Energy Minister expressed confidence that OPEC+ producers will prolong their output cuts program through the second half of 2019", said Han Tan, analyst at futures brokerage FXTM. Yet crude has since dropped more than 10% as the U.S. President Vladimir Putin has shown he's reluctant to walk away from the agreement, which also ensures his political partnership with Saudi Arabia as economic ties tighten.
Referring to the OPEC+ deal after the talks he held with Russia's top officials, Saudi Arabia's al-Falih told Russian news agency TASS in an interview published on Monday that "I am fairly confident that from the OPEC side nearly everyone agrees that we need to extend the Declaration of Cooperation", adding that "So, I think the remaining country to jump onboard now is Russia". Saudi Arabia also may be interested in taking a stake in Russian petrochemical producer Sibur Holding, he said.