Russian President Vladimir Putin said Wednesday that he had sealed a pact with the country's oil majors to freeze production as proposed last month by Moscow and Saudi Arabia to curb slumping prices. "Yesterday we met with the management of our leading oil firms, and on the whole an agreement has been reached that we will keep the level of oil production in 2016 at January's level," Putin was quoted as saying by Interfax. Saudi Arabia and Russia – two of the world's biggest oil producers – proposed after a Feb. 16 meeting with Qatar and Venezuela that all producer countries freeze their output at January levels to support prices, provided that other major producers followed suit. Putin gave no indication on Wednesday over the details of the agreement and whether Russia would freeze output even if other countries refused. The news of the February proposal sparked hopes the market would stabilize after sinking to near 13-year lows last week on the stubborn supply glut – but disappointed those looking for an output cut. Despite Iran's refusal to play ball, oil prices have significantly recovered since, supported by the announcement of a new meeting in mid-March between Russia and OPEC members Qatar, Venezuela and Saudi Arabia. The collapse in oil prices has plunged Russia, which is already subject to Western sanctions imposed over the Ukraine conflict, into a recession which is extending into a second year. Oil prices fell Wednesday as traders awaited the release of US crude inventory data, which are expected to show a further rise in stockpiles. At around 1100 GMT, the US benchmark West Texas Intermediate (WTI) for delivery in April slid 74 cents to stand at $33.66 a barrel. In London, Brent North Sea crude for May shed 36 cents to $36.45 a barrel compared with Monday's close. Crude futures had risen Tuesday on fresh Russian calls for a production freeze to reduce the global supply glut. "US crude oil inventories increasing is almost becoming a norm. Inventories are already at a historic high" and markets are taking a nonchalant stance towards a continued inch upwards, said Daniel Ang, analyst at Phillip Futures in Singapore. "US production, on the other hand, is slightly more interesting as it is finally starting to show corrections. We highly expect to see US oil production drop a lot more now that prices are in the $30 region, which could result in the easing of global oil supply," he added in a note.
