Oil tumbles below $50 first time in year on Russian Federation output stance

Petrol prices in India slide further as crude gets into $50 range

"Oil prices bounced back late in the day on Friday on reports that the OPEC committee had suggested a 1.3 million barrel per day cut from the October level", said Fawad Razaqzada, market analyst at futures brokerage Forex.com.

While Saudi Arabia and its Energy Minister Khalid al-Falih have been airing the idea of a new production cut, Russian Federation has been less convinced that it could take part in another reduction, or at least so it lets the market to believe.

The president might have some success in getting Saudi Arabia not to cut oil production because of how he has handled the killing of journalist Jamal Khashoggi in the Saudi Consulate in Istanbul. Alberta is working to buy rail cars to help ship more crude as pipeline bottlenecks have the oil-rich province grappling with historic low prices.

But oil trade, vital for Russian economy, is conducted in USA dollars, a "monopoly" Russia's President Vladimir Putin wants to end.

Oil producer group OPEC and its allies, led by Russian Federation, meet in Vienna next week against the backdrop of concerns over a slowing global economy and rising oil supplies from the United States, which is not involved in an existing agreement to restrain output.

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However the market was kept guessing by separate comments from Russian President Vladimir Putin who said that crude around $60 a barrel was "absolutely fine". However, the Saudi Arabian minister was less confident than previously, and he did not specify an actual cut in oil production.

"Iraq has been increasing production, but not to the extent that Saudi Arabia has done". Trump has backed Saudi Crown Prince Mohammed bin Salman despite calls from many USA politicians to impose stiff sanctions on Riyadh. EIA says USA crude oil inventories are now 7 percent above the five-year average for this time of year.

"This led to positive results", Putin said. At current prices, Saudi Arabia, which is heavily dependent on petroleum exports, can pay its bills and most oil companies can make a profit.

"Furthermore, our partners are helping us by introducing all these unlawful restrictions and violating principles of the global trade, because the whole world sees the dollar monopoly is unreliable; it is risky for many, not only for us", he said. They've been exempt from the group's cuts agreement and are unlikely to welcome a decision to include them in any new cuts, Petromatrix's Jakob said. According to Reuters, Moscow intends to reduce oil production gradually, and at the moment it is trading with Saudi Arabia with respect to time and volume reduction. That doesn't mean the Kremlin is about to give up its alliance with Saudi Arabia, which extends beyond oil, but it means could drive a hard bargain.

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