2024-04-03 23:11:34
Russian Deputy Prime Minister Alexander Novak announced on Friday that Russia will continue on the path of reducing its oil production in the second quarter, joining other Opec+ member countries in this coordinated measure.
Earlier this month, Russia had indicated it would reduce its oil production and exports by an additional 471,000 barrels per day during the second quarter, in line with concerted efforts with some OPEC+ countries.
Novak stressed that Russian oil companies will adjust their production according to their share in the country’s total oil production. This reduction is expected to be carried out gradually, with additional cuts scheduled for the months of April, May and June.
In April, a further production decline of 350,000 barrels per day (bpd) is expected, accompanied by a reduction in exports of 121,000 bpd. In May, the additional production cut will amount to 400,000 bpd, while exports will be reduced by 71,000 bpd. Finally, in June, all additional cuts will come from oil production.
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This decision by Russia to focus on reducing production rather than exports has been considered an unexpected move by some analysts. JP Morgan, in particular, noted that if Russia delivers on promised cuts, the country’s crude oil production should fall to 9 million barrels a day in June, matching Saudi Arabia’s output.
Currently, Russia produces approximately 9.5 million barrels of crude oil per day.
Novak explained that this measure seeks to ensure an equitable contribution from all countries to production cuts within the Opec+ agreement. “The time has come when, instead of exports, we reduce production,” said the official.
Industry sources have revealed that the Russian Government has ordered oil companies to reduce their production in the second quarter to ensure the country meets its production target of 9 million barrels per day by the end of June, in line with its commitments with Opec+.
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