Russian data show oil production in January slipped further below the nation’s OPEC+ quota, according to people familiar with the figures.
Output fell to 8.962 million barrels a day last month, the people said, asking not to be identified because the information isn’t public. That’s 16,000 barrels a day below Russia’s target under the OPEC+ supply agreement.
While the data show compliance with the OPEC+ deal, the country still needs to make up for past overproduction. It pledged to submit an updated schedule for compensation cuts in December, though none has been published. In winter, the harsh climate and geology of its oil fields can make it hard to slash output.
The Energy Ministry didn’t immediately respond to a request for comment.
Russia classified its official oil output data after Western sanctions targeted the nation’s energy industry following the invasion of Ukraine. That makes independent verification complicated, with market watchers relying on indicators such as seaborne exports and domestic refinery runs.
The Organization of Petroleum Exporting Countries and its allies are focusing on improving compliance with quotas amid signs of a global oversupply. Crude prices have eased since mid-January, but OPEC+’s monitoring committee stuck to existing output plans at a meeting last week. The group said it welcomed pledges by overproducing nations to make compensation cuts.
Russia has vowed to reduce crude output by 971,000 barrels a day from a baseline of 9.949 million barrels a day. That reduction figure doesn’t include compensation for overshooting quotas in the past.
In January, the US imposed its most aggressive sanctions yet on Russia’s oil industry, blacklisting two major crude producers as well as tankers shipping barrels abroad. Transactions subject to the restrictions have a wind-down period until the end of February. So far, the effect of the curbs on oil flows has been muted, according to data compiled by Bloomberg.
Source: by Scott Squires Bloomberg