Russia doesn’t rule out delaying scheduled production hikes by the OPEC+ alliance, President Vladimir Putin said, the latest sign the cartel could restrain crude output for longer as the pandemic crimps demand again.

Oil rose after Putin said he didn’t rule out a change of plan. Production cuts are due to be eased -- as part of a gradual tapering -- from January but the cartel has hinted it may change tack as demand falters. Putin’s preference was to adhere to the current plan.

“We think there is no need to change anything now,” Putin said in his address to the Kremlin-backed Valdai Club. Yet “we don’t rule out that we may keep the current restrictions on output, that we don’t lift them as soon as we have planned earlier.”

“If necessary, we can take a decision on further cuts,” he said. “But so far we simply see no such need.”

The Organization of Petroleum Exporting Countries and its allies have warned of a precarious outlook, and increasingly traders have signaled the market can’t absorb the extra barrels. Putin’s comments are the latest show of unity between Russia and Saudi Arabia, whose leaders have been engaged in intense telephone diplomacy this month.

After two phone calls between Saudi Arabia’s Crown Prince Mohammed Bin Salman and Putin in a week, their oil ministers displayed a united front at OPEC+’s last ministerial meeting. Their top oil officials, Prince Abdulaziz bin Salman and Alexander Novak, offered similarly bearish views and the prince called on the cartel to be “proactive,” and ready to “head off negative trends and developments -- to nip them in the bud.”

Under the current plan, the OPEC+ is set to relax its production curbs, adding nearly 2 million barrels a day in fresh oil production in January 2021. But OPEC+ ministers will debate whether to stick to that plan, which was decided during the depths of the oil crisis in April, or change it at a meeting scheduled for Nov. 30-Dec. 1. In July, the group delayed one month a similar production increase amid doubts about the strength in oil demand.

OPEC+ is a complex yet effective mechanism for stabilizing the global oil market, Putin said. “In this fragmented world, such an approach is really way more fruitful,” he said. Cooperation within OPEC+ “not only allows to solve specific problems but also is able to breathe new life into multilateral diplomacy,” Putin added.

Putin Ally

Putin spoke hours after Rosneft Chief Executive Officer Igor Sechin -- a longtime OPEC+ skeptic -- acknowledged that interactions between energy-producing nations are necessary, and called for action to stabilize the oil market.

While he didn’t mention OPEC+ by name, Sechin said that the world economy -- and oil demand -- may start to recover next year, but that “humankind needs to take coordinated actions to achieve such a result.”

Sechin, Putin’s close ally, said in March -- during a price war with Saudi Arabia -- that Russia’s cooperation with OPEC could be over.

Despite his opposition to OPEC+, Rosneft has been cutting its crude production in line with the coalition’s agreement. Russia’s overall compliance with the OPEC+ deal has been at 96% to 97% in the past two months.