Complying to OPEC+ Russia reduced oil production to 8.7 million b/d

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Complying to OPEC+ Russia reduced oil production to 8.7 million b/d

Russian oil almost reached the level of reducing transaction OPEC+: oil production, excluding condensate, in early May, decreased to 8.7 million b/d with a target of 8.5 million b/d. a Significant part of the reduction falls on the Mature assets in West Siberia. In the Ministry of energy noted that the company will be able to recover the loot if necessary for several weeks.

Experts believe that such a rapid decline in production is now important not only with the market but also with the “psychological” point of view, to stimulate other players to the speedy implementation of the agreement.

Domestic oil companies have almost completed the reduction of production by agreement with OPEC. Deals from May to June, average daily oil production in Russia is expected to decline by 2.5 million b/c relative to February 2020.

According to Reuters and “Interfax”, since the beginning of the new deal from may 1 oil and condensate (not included in the transaction OPEC+) decreased to 9.5 million b/d, although back in April was 11.3 million b/d. t

Thus, excluding condensate production, fell, according to “Kommersant”, to 8.7 million b/c, nearly reaching the target level of 8.5 million b/d. According to the information of Interfax, Rosneft has already cut production by 39-46% at the enterprises of “RN-Severnaya Neft”, “TNK-Nyagan”, “RN-Shelf far East”.

The largest enterprise of “Rosneft” “RN-Yuganskneftegaz” (developing the Priobskoye field in the Khanty) production decreased by 18%. According to the Agency, LUKOIL has lowered the production by 21% in the perimeter cuts have included, in particular, of the JV company Wintershall — “volgodeminoyl”, “LUKOIL-Kaliningradmorneft, LUKOIL-Western Siberia, LUKOIL-Komi” and RITEK. The largest share reduction of “Gazprom oil” in 37% of the assumed structure of “Gazpromneft Noyabrskneftegaz”.

The perimeter of the deal and got “Gazpromneft-Khantos” (developing the Priobskoye field), which reduced production by 18%. Among the projects, the PSA all significantly reduced production structure Zarubezhneft “Zarubezhneft-production Kharyaga” (the operator of Kharyaga PSA) by 27% compared to the same period in April.

Deputy Minister of energy Pavel Sorokin hopes that the RF out on the maximum reduction of “promptly”.

At the same time, the official said, “the volumes, which are now reduced, can be returned to the market fast enough, some companies can do it for several weeks, but for smaller parts, it will take a month”.

The reduction is important, both market and psychological points of view said Daria Kozlova from Vygon Consulting: risk of an overflow of storage is still high, so the compliance of OPEC+ is an important element of the industry out of the crisis as “buys” an additional 4-5 months until complete filling of the storage until the demand starts to recover.

Kozlova, a discussion of the reduction is already more than a month, so the Russian companies were the Foundation for holding of priority measures to reduce production.

In General, according to experts, the sector would have a significant reorganization from growth strategy to an optimization strategy, which will continue at least until the end of the year. Dmitry Kosovrasti is the largest-ever production cuts to netikette next.