Oil price lifted by Russia backing Opec production freeze

Russia has said it will support a proposal by Opec to freeze oil production in order to reverse the slump in global prices.

The move lifted the price of oil, with Brent crude hitting a 52-week high.

"Russia is ready to accede to joint measures to reduce [oil] production, and is calling on other oil exporters to do so," said Russian President Vladimir Putin.

"We support the recent Opec initiative to set production limits," he added.

In late afternoon Brent Crude oil was trading up by 2.5% at $53.21 a barrel, just off the $53.73 high hit earlier on Monday.

Speaking at the World Energy Congress in Istanbul, Mr Putin said that oil prices had "more than halved" in two years due to surplus production, provoking a "cycle of decreasing investment".

He said that if the trends persisted, they would give way to oil shortages and "new, unpredictable price hikes".

He expects to reach an agreement to support a cut at Opec's next meeting in November, he said.

"Of course, this will also cool down speculative activities and help avoid new price fluctuations," he said.

In September, members of the The Organisation of the Petroleum Exporting Countries (Opec) voted to cut production for the first time in eight years.

The group's 14 members produce about a third of the world's oil and have been hit hard by falling prices, as has Russia.

Opec aims to agree to cut around 700,000 barrels per day at its policy meeting on 30 November in Vienna, bringing its output to 32.533 million barrels per day.

production for the first time in eight years

But some analysts have questioned whether all of its members will stick to the agreement.

Differences between Iran and its regional rival, Saudi Arabia, have thwarted efforts to reach a deal in the past, and Russia's latest intervention may have little impact, said John Hall, chairman at Alfaenergy group

"Russia and Opec have not worked well in the past, and while Vladimir Putin promising joint measures is welcome, whether he sticks to it is another matter," he said.

"You've also got to see the wider context: Saudi Arabia and Iran are in a proxy war in Yemen. It is still very doubtful they can come to an agreement whether Russia supports a cut or not."

However, John Kilduff, partner at New York energy hedge fund Again Capital, told the Reuters News Agency: "Putin coming out to say Russia will be part of the initiative has added another layer of credence to the speculation there will be a coordinated cut.

"At some point, the market will call them on it and say 'show us the cuts'."

In his speech Mr Putin also criticised unilateral sanctions, suggesting the US had blocked the expansion of more oil pipelines from Russia to Europe.

"The authorities in certain countries have been telling businesses to close profitable projects, refuse to buy fuel supplied via the shortest possible routes and at attractive prices," he said.

"Such actions do nothing to increase the stability of global energy system and also of the global economy as a whole."