Russia Signals It Will Stay Out Of OPEC

Angola's President Jose Eduardo dos Santos (right) and Russian President Dmitry Medvedev meet in Luanda

LUANDA (Reuters) -- Russia clearly sees itself as an observer and not a member of OPEC, President Dmitry Medvedev told the oil producer group's current president on June 26.

The Organization of the Petroleum Exporting Countries (OPEC), which accounts for around 40 percent of the world's oil production, has repeatedly invited Russia to participate at its meetings in the hope that it would join or work with the group.

"In regards to our interaction with OPEC our positions are clear. Angola is a member of OPEC, while Russia participates in OPEC as an observer," Medvedev said at a news conference alongside Angolan President Jose Eduardo dos Santos, whose country holds the rotating OPEC presidency.

Medvedev said the current ways in which oil prices were determined were too "complex and lacked transparency," adding that the oil market should not depend on one economy -- a reference to the United States.

"There is still much to do. We are not happy with the current situation. I will put it simply: the oil market should not depend on the situation of just one economy."

Russia has repeatedly called for the world to become less reliant on the U.S. dollar. The unit, in which oil prices are denominated, has a considerable effect on the price of crude.

Angola marks the final stop of Russian President Dmitry Medvedev's four-country trip to Africa, the first visit to the continent as Russian leader. Russia faces tough competition from the United States and China for resources in Africa.

Relations between Russia and OPEC went cold earlier this year when Russia did not follow through on indications it might reduce output in sympathy with OPEC's planned cuts.

Some analysts say OPEC's production cuts have essentially been subsidising Russia's oil-fuelled economy by supporting the price. Russia recently surpassed Saudi Arabia as the world's biggest oil producer.

Russia had been sending high level observers to OPEC meetings but did not attend OPEC's last meeting in May.