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Russian, US energy ministries note necessity to respond to challenges in energy sector

Alexander Novak and Dan Brouillette underscored that the falling demand and oil supply glut pose a challenge to the global economy

Russian Energy Minister Alexander Novak Alexei Druzhinin/Russian Presidential Press and Information Office/TAS

Russian Energy Minister Alexander Novak

© Alexei Druzhinin/Russian Presidential Press and Information Office/TAS

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MOSCOW, April 1. /TASS/. Russian Energy Minister Alexander Novak has held telephone talks with US Secretary of Energy Dan Brouillette. The sides discussed the current state of the global oil market and the promising areas of cooperation, agreed to continue the dialogue and noted the necessity to respond to existing challenges in the global energy sector, such as the falling demand and oil supply glut, Russia’s Energy Ministry said in a statement on Wednesday.

"Ministers noted that the falling demand and supply glut on the oil market do not facilitate the development of global energy and create risks for the stable supply of the market after the start of the global economic recovery. Moreover, heads of energy departments noted the necessity to provide a constructive response to existing challenges and further continuation of the dialogue," the statement runs.

The sides also discussed the promising areas of cooperation between the two countries on the energy market through G20 and World Bank.

The ministry noted that the talks between energy ministers of the two states were held after the telephone conversation between Russian and US presidents, Vladimir Putin and Donald Trump, on March 30.

On Monday, the Kremlin’s press service said that heads of the two countries hashed over the current status of the global oil market, adding that it was agreed to hold Russian-American consultations on that issue through energy ministers. The White House also reported that presidents had agreed the necessity to ensure stability on global energy markets.

The OPEC+ agreement on crude production cuts expired on March 31. It was not extended due to divergent positions of two biggest participants as Russia suggested that the deal be extended under the previous conditions and for the second quarter of 2020 only, whereas Saudi Arabia insisted on deepening cuts by another 1.5 mln barrels per day by the end of the year. After withdrawing from the agreement, the kingdom plans to capture the oil market by reducing prices. Meanwhile, the global oil demand may decline by 26-30 mln barrels per day, analysts warn, as oil consumption has dropped sharply due to quarantine measures across the globe.

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