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Countries should unite efforts to stabilize global oil market — Putin

February 09, 2015, 9:41 UTC+3 MOSCOW

A predictable and stable energy resources market meets the interests of all the states so it is necessary to create conditions for its steady long-term development, the Russian president says

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© AP Photo/Hasan Jamali

MOSCOW, February 9. /TASS/. The responsible players of the global oil market should unite their efforts to make it stable and predictable, Russian President Vladimir Putin said in an interview with Egyptian newspaper Al Ahram ahead of his two-day visit to Cairo.

"A predictable and stable energy resources market meets the interests of all the states. That’s why in current conditions, it is necessary to unite efforts of responsible oil market actors to create conditions for its steady long-term development," Putin stressed, commenting on the possible consequences as the oil prices have dropped by half in the past six months.

Putin said the main risk of falling oil prices is that the oil and gas sector is becoming less attractive for investors. As a result, the companies are forced to abandon the development of technologically-difficult deposits and infrastructure improvement projects what will finally lead to a decrease in oil supply on the market.

"This means that at some moment there could be a powerful price correction in the opposite direction that would become a true economic shock. Neither oil producers, nor consuming countries or the global economy as a whole need such shocks," the Russian leader said.

Putin reminded that the budgets of many Middle East countries are based on higher oil prices than those observed now. At the same time, the region faces new challenges and adequate responses to them demand attracting additional resources.

"That’s why an understanding has been growing in the Middle East that there is a need to stabilize the oil market and balance the demand and supply," the Russian president said.

Speaking on Russia, Putin said the drop in global oil prices negatively affects the country’s economy, but it has significant accumulated reserves and a large-scale anti-crisis plan to overcome the difficulties.

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