Russia, OPEC explore oil solutions
Russia met with OPEC to discuss ways of leveling out the cost of oil, as oil is now so low it could make production and investment unprofitable. Megan Williams reports it's unlikely Russia would agree to cut production.
Russian President Dmitry Medvedev (Dmitry Astakhov/AFP/Getty Images)
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TEXT OF STORY
Renita Jablonski: The Organization for Petroleum Exporting Countries meets tomorrow to talk production cuts. The price of crude has slid way down, just below $68 a barrel this morning. Russia just met with OPEC. As Megan Williams reports, the world's second-largest oil producer is also looking for ways to cope with volatile prices.
Megan Williams: Russian leaders met with the head of OPEC to talk more cooperation in leveling out rollercoaster prices. Cost of oil is now so low, it could make production and investment unprofitable.
Oil expert Peter Kemp says it's unlikely Russia, whose production is already falling, would agree to cut.
Peter Kemp: The Russians, like all major oil producers, are truly concerned by the sudden and dramatic fall of oil prices, but I would be very surprised if we see that actually materialize in substantial cuts in production from Russia.
One idea Russia floated to influence prices was to stockpile oil instead of placing it on the open market. Kemp says countries build up reserves as a back-up for supply interruption, but:
Kemp: The idea of setting up a reserve that would somehow be used to influence the market sounds like a pretty wild idea, which I don't think would find any support from OPEC or anybody else.
Tomorrow, OPEC meets to agree on production cut levels.
I'm Megan Williams for Marketplace.
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