(Bloomberg) -- U.S. Treasury Secretary Steven Mnuchin “emphasized the importance of orderly energy markets” to the Russian ambassador in Washington, Anatoly Antonov, in a meeting on Monday, according to a statement.
The two men met as oil prices fell more than 30% on Monday after the break-up of the so-called OPEC+ alliance, in which Russia and Saudi Arabia had agreed to limit production. Both countries have plans to vastly expand their output in a price war.
Treasury said in a statement that in addition to oil, Mnuchin and Antonov discussed “compliance with sanctions programs, Venezuelan economic conditions and the potential for trade and investment.” The U.S. has pressured Russia’s Rosneft PJSC to exit Venezuela, where crude exports help keep President Nicolas Maduro’s regime afloat.
The OPEC+ arrangement, which had underpinned oil prices since 2016, collapsed on Friday after Russian oil minister Alexander Novak rejected an ultimatum at a Vienna summit to join in a collective production cut. Russia has sought to increase production to punish American shale drillers.
Saudia Arabia’s state energy company Saudi Aramco responded by offering unprecedented discounts on Saturday to customers in Asia, Europe and the U.S. Rosneft plans to pump significantly more oil next month, when the OPEC+ arrangement formally ends, and Novak said the country’s share of oil export markets will be preserved.
U.S. stocks extended losses back past 7%, as the oil price war rattled financial markets already on edge over the spreading coronavirus. Treasury yields plummeted and credit markets buckled.
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