Russia, OPEC can ditch oil deal to fight for market share: Russian Minister

MOSKOW (Reuters) ) – Russia and OPEC may decide to increase production to fight for market share with the US, but this would push oil prices as low as $ 40 a barrel, said TASS news agency Russian Finance Minister Anton Siluanov on Saturday.

"It's a dilemma. What are we going to do with OPEC: should we lose the market, being occupied by the Americans, or ending the deal?" Anton Siluanov, who spoke in Washington, said TASS.

"(If the deal ceases), oil prices will decline, as the new investments will shrink, US production will be lower, because the production cost of shale oil is higher than for traditional production."

Siluanov said oil prices could fall to $ 40 per barrel or even less for up to one year.

The minister said that there had been no decision on the agreement yet and he did not know if the OPEC countries would be happy with this scenario.

OPEC, Russia and other manufacturers, an alliance known as OPEC +, reduce production by 1.2 million bpd from January 1 for six months. They meet June 25-26 to decide to extend the pact.

Total supply reductions have helped drive a 32 percent rally in crude prices this year to nearly $ 72 a barrel, and urged US President Donald Trump to call OPEC to ease his market support. OPEC has said the edges must remain, but there are signs that attitude is now softer.

Earlier this week, sources familiar with the Reuters case told that OPEC could increase its oil production from July if Venezuelan and Iranian supplies are falling further and prices continue to rally because expanding production cuts with Russia and other Allies could surpass the market.