OPEC may extend oil production pact with Russia up to two decades

Organization of the Petroleum Exporting Countries, OPEC, is reportedly looking to extend oil production cooperation with Russia for up to 20 years, Saudi Arabia’s crown prince said Tuesday.

Mohammed bin Salman, Saudi Crown Prince told Reuters that OPEC is looking for a long-term agreement of 10 to 20 years and the two sides have “agreement on the big picture, but not yet on the detail.”

The current OPEC-Russia output deal to remove 1.8 million barrels per day from the global market expires at year-end.

But the Saudi-led cartel and Russia have warmed up to the idea of a longer-term agreement.

Last week, Saudi Energy Minister Khalid al-Falih told Reuters that “we still have some time to go before we bring inventories down to the level we consider normal and we will identify that by midyear when we meet in Vienna.

At the IHS CERAWeek conference in Houston earlier this month, Mohammed Barkindo, OPEC Secretary-General suggested that the oil group would continue its alliance with Russia and other non-OPEC producers.

Aleksey Texler, Russia’s first deputy energy minister, said at the same conference that while Russia wouldn’t join OPEC, that cooperation should continue but maybe in a “slightly different format.”

The U.S. shale boom has put pressure on OPEC and its allies to curb production to help prevent another price collapse.

Salman also told Reuters Tuesday that the flotation of a 5% stake in state-run Saudi Aramco could happen at the end of this year or early 2019.