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Russia is gradually reducing oil production in line with the OPEC+ deal and is on track to get about a fifth of the way toward its pledged cut this month.
Preliminary data show the nation’s output has already fallen by more than 30.000 bopd relative to October levels. Energy Minister Alexander Novak said Friday. “The companies have said they can decrease total production by 50.000 bopd in January.“ he told reporters in Moscow.
Russia has agreed with the Organization of Petroleum Exporting Countries to gradually implement a cut of 228.000 bopd by the end of the first quarter. compared with October production of 11.418 MMbopd. The country opened the taps before the restrictions began. pumping a post-Soviet record of 11.45 MMbopd in December. meaning the month-to-month output drop will be steeper.
In the OPEC+ accord. Russia was allowed to make the cuts gradually since the harsh climate and complex geology of Siberia. its main oil province. prevent swift field shutdowns. In contrast. Saudi Arabia said it has already fully implemented its production cut and even gone a little deeper. pumping 10.2 MMbopd.
Russia’s reductions are modest compared with the cuts from some of its partners. In December — before the agreement to curtail supplies even started — OPEC production plunged by 530.000 bopd. the most in almost two years. The OPEC+ alliance agreed to trim output by a total 1.2 MMbopd in the first half of 2019.
While the curbs have helped push benchmark Brent crude back above $60 a barrel. prices remain about 30% below their four-year high in early October.
The next meeting of the Joint Ministerial Monitoring Committee. which oversees implementation of the production cuts. may take place in April. although that date could change. Novak said.
