Putin Says Russia Must Act to Influence Oil Prices

Russia's Prime Minister Vladimir Putin said the country must act to influence oil prices hit by the global economic crisis, in what could signal a significant change of approach by the major crude exporter.

"We need to work out a whole range of measures that will allow us to actively influence the market," he said in comments broadcast on television after a government meeting on oil production.

"As one of the major exporters and producers of oil and petroleum products, Russia cannot stand aside from formulation of global prices for this natural resource."

Oil prices have fallen sharply from record highs of 147 dollars per barrel in July as the global financial crisis has slowed economic growth and demand.

Russia is not a member of the Organization of Petroleum Exporting Countries (OPEC) and has traditionally steered clear of working closely with the cartel to set production and pricing levels.

Vice-premier Igor Sechin said on Wednesday, however, that Russia was ready to cooperate with other oil producing countries to prop up the price of crude but was determined to stay in charge of its own production levels.

OPEC last month decided to cut production by 1.5 million barrels a day in a bid to stem the fall in the price of oil.

World oil prices climbed in Asian trade on Monday after OPEC refused to rule out further output cuts and China announced a massive stimulus package aimed at boosting domestic spending, dealers said.

Oil prices fell Monday on profit-taking after earlier jumping by more than three dollars, with New York's main contract, light sweet crude for delivery in December slipping 33 cents to 60.71 dollars per barrel. The contract earlier went as high as 65.56 dollars.

OPEC's 13 countries account for around 43 percent of world production with Russia on 12 percent.

Putin also suggested that the export tax on oil should be reviewed monthly, instead of every two months as at present. The government sharply lowered it this month to 287 dollars per tonne.

"The world financial crisis, the instability on international markets and raw materials and the fall in the price of oil, demand that we adopt measures that will ensure lasting development of the sector in current conditions," Putin said on Monday.

Author: Jo Amey