Russia’s energy ministry has revised up its forecast for 2018 domestic crude oil output to reflect the latest decision under the OPEC/non-OPEC deal on increasing crude output, energy minister Alexander Novak said Wednesday.
Russia is now expected to produce 551 million mt this year, up 0.8% on the year, Novak said. The figure translates to 11.065 million b/d, under the widely used 7.33 barrels per metric ton conversion rate. The ministry’s daily output figure, however, has varied in the past because it uses different rates per day depending on the fields from which the crude comes.
“In light of the latest decision on the OPEC plus deal to gradually increase crude output, we have revised the crude output forecast for the whole of 2018 and have increased it by about 3.5 million mt to 551 million mt,” he said in the ministry statement.
Novak said he expects Russian crude output to rise 0.9% in 2019 to 555 million mt, reiterating the forecast from earlier this month, but warning the estimates may change.
“These are preliminary forecasts — a lot will depend on market dynamics and the need to correct our course,” he said.
Under the OPEC/non-OPEC deal in effect from January 2017 and intended to cut a combined 1.8 million b/d of members’ output, Russia initially agreed to cut 300,000 b/d from the October 2016 base level of 11.246 million b/d. With the terms of the deal originally expected to apply through 2018, Russia had planned to keep its output flat year on year.
Following the decision in June by OPEC and its partners to boost output by 1 million b/d combined from May levels, however, Russia pledged to bring an extra 200,000 b/d onto the market starting this month.
Russia produced 10.973 million b/d of crude in May, raising the volume to 11.063 million b/d by in June, according to the Central Dispatching Unit, the statistical arm of the energy ministry.
In mid-July, Novak said Russian companies were bringing two thirds, “or even 80%” of the cut volume back onto the market.
Russian crude production is expected to peak at around 11.246 million b/d in 2020-21, according to a recent short-term economic outlook from the economic development ministry.
Source: PlattsPrevious Next