Novak: the final decision on stabilization of oil production will be made in March

MOSCOW, 1 March. The final decision on stabilization of oil production will be made in March, formats still to be discussed, most importantly the monitoring of the agreements, said the Minister of energy Alexander Novak.

“The company confirmed their support for the initiative, as is predictability for market participants. Agreed that we will monitor the situation. The initiative is still being discussed. Many countries expressed their support, then we will work together with other countries-members of OPEC and OPEC to agree to meet in March to consider adopting the final decision”, – said the Minister.

“In what format it will be done, yet to be discussed with colleagues. The format is not specified. The most important issue is monitoring the implementation of those agreements that can be achieved,” added Novak.

Plans for drilling and developing fields this year

The energy Minister also said that the leaders of the Russian oil companies at the meeting with the Russian President Vladimir Putin confirmed plans for drilling and development of fields on the current year.

“The company confirmed their plans for 2016 on exploration and development drilling, field development. For those licenses that were issued in previous periods. It is really important that in a difficult situation, our company competitive,” he said.

The “freezing” of oil production

Over 15 countries have already confirmed their agreement with the “freezing” of oil production, said Alexander Novak. The decision to “freeze” the level of oil production joined the countries that produce 73% of oil in the world, this “critical mass”, said the Minister of energy. Even without the accession of Iran to the decision to “freeze” the oil it will be effective, said the head of the Ministry of energy.

“Freezing” the oil production volumes are expected to reduce the cycle of lower oil prices on the year – Novak.

Formats stabilization of crude oil yet to be discussed, the most important element of the monitoring arrangements – Novak.

The price of oil at $50-60 will avoid oversupply – Novak. Stabilization of oil production do not pose a problem to raise prices above $50-60 per barrel, this will again lead to oversupply.

About saving taxation system for the industry

Alexander Novak also said that the oil companies asked the President to maintain a system of taxation for the industry. “Companies, of course, told the President that the most important thing in this market situation, volatile situation at the prices, unpredictability is the preservation in some medium term the tax system that has developed”, – said the Minister.

The Minister noted that the companies ‘ plans can only be achieved if the tax system would not be innovation related to the increase in the tax burden.

Novak noted that the final decision on the matter “will depend on the situation, and this will be discussed in the government in the first place. And then presented to the presidential level.” The Minister added that no decision on Tuesday was not taken, but “the President heard of the company”.

For Iran can an individual’s decision to participate in the stabilization of oil production – Novak.