Saudi Arabia's energy minister said that Russian Federation has helped to breathe new life into OPEC and that shale can be a major contributor to the market in years to come.
Saudi King Salman is now in Russian Federation as part of a state visit, the first to Moscow by a reigning Saudi monarch.
However, the agenda also included issues on which the two sides deeply differ, including the war in Syria.
OPEC ministers attending the Moscow event said they were considering extending the deal or making a deeper cut.
Russian Federation and Saudi Arabia are heavily dependent on oil exports and the global plunge of the price of crude that began in 2014 lashed both their economies.
On or hand, two countries continue to cooperate in efforts conducted by OPEC and non-OPEC countries for balancing of oil prices.
The price of Brent crude oil, the global benchmark, was around the $55 per barrel mark midday Wednesday, trading higher than the first days of the week.
The leaders held one-on-one talks, followed by broader discussions.More news: Equifax scores $7.25 million IRS contract despite security woes
More recently, tensions were high over the war in Syria, in which Russian Federation has staunchly backed Syrian president Bashar Assad while Saudi Arabia has supported his foes.
Putin visited Riyadh in 2007 and last met Salman in Turkey in 2015. His Saudi counterpart, Adel al-Jubeir, said new horizons had opened for Russia-Saudi ties that he could not previously have imagined.
These agreements are "expected to play a pivotal role in the growth and development of the military and military systems industry in Saudi Arabia", the SAMI statement added.
Salman said he was looking to expand relations with "friendly nation" Russian Federation "in the interests of peace, security and development of the world economy".
The memorandum of understanding was one of several signed at the Russian-Saudi Business Investment Forum in Moscow.
The two countries also agreed on the production in Saudi Arabia of the Kalashnikov automatic rifle and its ammunition as well as educational and training programmes for Saudi nationals.
The current agreement runs until March 2018.
Saudi Arabia is now investing over $1 billion in over 20 Russian projects including the construction of a petrochemical complex and Pulkovo Airport in St Petersburg, Russian Energy Minister and co-chairman of the Russian-Saudi Intergovernmental Commission Alexander Novak said. However, Aramco chief executive Amin Nasser said such a deal was not being discussed at this stage.