Earlier, Russian Finance Minister Anton Siluanov said that the price of oil could drop to $30 a barrel if OPEC and its partners fail to agree on extending the production cuts that now expire at the end of June.
Novak conceded that $40/bbl or less wouldn't be out of the question if Russia, Saudi Arabia and their OPEC+ partners fail to reach a decision on extending curbs.
This scenario, known in the oil trading sector as "backwardation", is a fundamental support to the market that is not reflected in oil prices. "But we have no such need due to the more diversified nature of the Russian economy".
Powerful oil executive Igor Sechin, chief executive of Rosneft, has warned against extending the deal, saying the agreement posed a strategic threat to Moscow as it could allow the United States to take Russian market share.
"It is just thinking aloud about what to do in case trade tensions are exacerbated with potentially huge adverse impacts on the world economy, and thus oil demand", said one of the sources familiar with the matter.
China's crude oil imports slipped to around 40.23 million tonnes in May, from an all-time high of 43.73 million tonnes in April, customs data showed, due to a drop in Iranian imports caused by USA sanctions and refinery maintenance. "China tariffs could cut 2020 global gross domestic product by 0.5%".
Brent crude futures, the worldwide benchmark for oil prices, fell $1.33, or 2.1%, to $60.96 a barrel by 1:09 p.m. EDT (1709 GMT).
Barclays bank noted that over the past week or so, economists had lowered their GDP growth outlook for the United States, China, India and Brazil - countries that make up more than three-quarters of their oil demand growth assumptions for this year, as quoted on CNBC. Analysts had forecast a decrease of 481,000 barrels.
The charter has been delayed over disagreements on how structured or loose to make the OPEC/non-OPEC coalition."The current status of the global oil markets, which are volatile once again, makes the Saudi-Russian cooperation all the more important", Falih said in a speech at the Moscow summit.
Falih said he may meet Novak again at the G20 meeting in Japan on June 28-29, "to further calibrate our positions".Despite Russia's wavering on its cuts, both sides said they remain committed to continuing cooperation on managing the oil market.
The two ministers yesterday discussed postponing the next OPEC meeting to 4 July, instead of 25 June, according to Novak. "The immediate price outlook remains anything but clear".