"Next year knowing in view of companies' plans, production will decline 1-1.5%," Leonid Fedun told a UBS conference in Moscow.
Fedun also said Russia could join the Organization of the Petroleum Exporting Countries.
"Cooperation has started between Russia and OPEC. Maybe we are even talking about Russia joining OPEC. LUKoil and Rosneft heads are due to take part in the next OPEC session in December," he said.
Fedun said LUKoil believes capital investment by Russian companies needs to reach $100 billion annually for Russia to maintain its current levels of oil production.
The Russian Energy Ministry forecasts in 2008 oil production in Russia will drop 1 million tons, or 0.3-0.4% to 490 million tons against last year.
Earlier Fedun said that LUKoil planned to increase oil production by 1.5% with gas output rising by 3-4% in 2009.
However, Fedun said that the global financial crisis could force the company to cut investment in 2009 which would affect its drilling program and plans to modernize oil refineries.