Putin steps back into OPEC production fray

MOSCOW, Nov. 29 (UPI) -- After deferring to his energy minister, the Kremlin said Russian President Vladimir Putin was reviewing production proposals with OPEC member Iran.

The Kremlin said Putin spoke by phone with his Iranian counterpart, Hassan Rouhani, to survey prospects for stronger economic ties. With both countries relying on oil to drive their economies, the Kremlin said the focus of the conversation was a production proposal under consideration in Vienna.

"The two presidents agreed to continue coordinating steps in global hydrocarbon markets, including as part of the Russia-OPEC energy dialogue, and noted the critical importance of measures taken by OPEC to limit crude oil production as the key factor in stabilizing the global oil market," the president's office said in a statement.

The Organization of Petroleum Exporting Countries is working to agree on a production ceiling that is meant to pull a market tilted toward the supply side back into balance. Russia and Iran are both producing oil at or near record highs, and Tehran has said it needs to keep up that pace in order to regain a market share lost to sanctions.

The Kremlin said the phone call with Rouhani came at Iran's initiative.

More than two dozen representatives from top oil and gas companies in Russia, including Gazprom, traveled to Tehran in mid-November to discuss opportunities in the opening Iranian energy sector. The two countries have established energy ties, with Russia supplying some of the fuel needed to power the Bushehr nuclear power plant in Iran.

OPEC is leaning in part on non-member states like Russia to make a production proposal stick. Putin said Russia was ready to "freeze production" at current levels, which are at post-Soviet highs.

OPEC ministers are gathered in Vienna this week to review prospects for a production ceiling. Putin's spokesman this week said the president was staying out of the debate, deferring matters to Oil Minister Alexander Novak.

Novak has said there were no considerations for a cut in output from Russia.