The decline of 120,000 barrels a day, to 2.37 million barrels a day, underscores the inability of state energy company Petróleos de Venezuela SA to maintain oil-industry investments, as the region’s largest petroleum exporter suffers from a debilitating cash crunch, widespread food shortages and civil unrest.

South America’s two largest oil producing nations face bigger threats from political turmoil than depressed crude prices, but reforms in their national oil companies (NOC) and energy ministries may be essential for their governments to survive.

“We’ve worked out a common position,” Novak said, commenting on the deal. “We discussed various options, including doing nothing and cutting production.” An oil price at $50 a barrel is acceptable for exporters and consumers over the long term, he said. Brent crude, a global benchmark, traded at about $33 on Friday after dropping 45 percent over the past year.

The document reflects indicative terms and conditions in relation to the equity acquisition. Currently Rosneft owns 16,67% in this joint venture, after the transaction is completed Rosneft will increase its stake to 40% of JV and PDVSA participation will be reduced to 60%.

Saudi Arabia and Russia, the world’s two largest crude producers, agreed to freeze output after talks in Qatar.

Rosneft, as part of a PetroMiranda JV including PDVSA and Gazprom Neft, has drilled an unprecedented horizontal well GG1-14 at the Junin-6 block. The well is unique for the shallow depth, only 1,140 feet or about 347 meters, of the reservoir interval and the length of horizontal section 4,920 feet or 1,500 meters. The total length of the well is 6,059 feet (some 1,847 meters).

Eni has started production of the giant gas field Perla, located in the Gulf of Venezuela, 50 kilometers offshore. The first production well has been opened and is currently in the clean-up phase.

Venezuela and Russia's top oil producer, Rosneft, have agreed on around $14 billion in investment in the South American OPEC country's oil and gas sector, President Nicolas Maduro said on Wednesday evening.

Venezuela is pushing for a new agreement between OPEC and non-OPEC nations to stabilize oil prices, President Nicolas Maduro said on Friday, in the most serious indication yet of a renewed drive to boost prices back to $100 per barrel.

Oil-price collapse may aggravate producing nations’ other problems