Russia says global oil stockpiles will cover Saudi shortfalls

Energy Minister Alexander Novak to speak with Saudi counterpart Prince Abdulaziz bin Salman to get full assessment

OPEC Secretary-General Mohammed Barkindo, left, Saudi Energy Minister Prince Abdulaziz bin Salman, center, and Russian Energy Minister Alexander Novak, attend a news conference after an OPEC meeting iShow more

Russia has said that global commercial stockpiles of oil will be sufficient to make up for reduction in the market following the drone attacks on key oil facilities in Saudi Arabia that knocked out more than 5 per cent of global supply.

Brent crude prices skyrocketed as much as 20 per cent on Monday to $71 per barrel after coordinated drone attacks on the Abqaiq refinery and the Khurais oilfield, which the US blamed on Iran. Houthi rebels in Yemen have claimed the attacks, which may affect Saudi production for weeks.

"There are enough commercial reserves in the world to ensure that in the medium term the oil shortage that we see can be covered by supplies from commercial reserves," Russian Energy Minister, Alexander Novak, said Monday.

Saudi Arabia, the world's largest exporter supplying about 10 per cent of the global demand, has yet to give clarity on how long it will take to restore output to 9.8 million barrels per day level prior to the attacks.

Mr Novak said it was too early to say whether Russia would increase output to make up for the drop in Saudi production, saying it depends on how long officials in the kingdom believe it will take to restore production levels.

"It all depends on a speedy assessment of the consequences, which is being carried out by our Saudi colleagues, from there it will be possible to understand the scale of the impact on production volumes and supplies," Mr Novak said.

The minister said he plans to speak with newly-appointed Saudi Energy Minister Prince Abdulaziz bin Salman on Monday.

Some Russian oil majors balked at Moscow's 2016 alliance with the Opec producers' group, which has forced Russian producers to scale back production to keep prices stable.

While Rosneft, Russia's largest oil company headed by Opec sceptic Igor Sechin, may seek to open the taps to cover demand left after the Saudi attacks, Mr Novak said all members of the Opec+ allianceshould hold to quotas.

"If there is a need, in case of an emergency, we always can get together and discuss some other parameters," he was cited as saying by Reuters. "But it is too early to talk about it now."

Russian President Vladimir Putin, who presides over the country's energy sector and foreign policy decisions, may discuss the Saudi attacks at meetings with Iranian leader Hassan Rouhani and Turkish President Recep Tayyip Erdogan in Ankara on Monday, the Kremlin said.