Saudi's Willing to Cut Production in "Much More Critical" Oil Market, says Algeria

Algeria's Energy and Mining Minister Noureddine Boutarfa

Saudi Arabia is willing to cut its crude output back to January levels of 10.2 million barrels a day (bpd), Algeria's Energy and Mining Minister Noureddine Boutarfa said Sunday ahead of oil talks in the country this week aimed at stabilizing oil prices.

For comparison, the Kingdom's production for August is reported to have risen to a record 10.69 million bpd.

Boutarfa called the offer "an interesting step" while also stating that oil markets were now in a "much more critical" state then they were at Organization of the Petroleum Exporting Countries (OPEC) meetings earlier in the year, which failed to establish any output limits.

"We are seeking to take a common decision, which everyone will support, whether it will be to freeze the level of output or reduce it. We are seeking to agree on the time frame of implementing the decision," Boutarfa was quoted by Russia media as saying during a press conference Sunday.

The minister was also hopeful of the meeting being given "official status" by OPEC secretary-general Mohammed Barkindo.

Last week Barkindo said of the Algeria talks that: "We're not meeting for a decision, we are meeting for a consultation."

Still, whatever the outcome of the talks, a growing number of voices are saying that freeze or no freeze, prices will stay low for at least the next few years.

Russian finance minister Anton Siluanov is the latest case in point, who last week said: "A freeze on the part of several countries ... will not produce the effect that some people are anticipating."

"There is the possibility that there will be an increase in oil production as a result of shale oil and then the prices will fall again."