Russia cuts oil production by less than agreed last month

May 09, 2024 (MLN): Russia cut its crude oil production by less than pledged last month, exceeding the voluntary target agreed in March with OPEC+, as Bloomberg reported, citing calculations based on official data.

Daily crude production averaged just under 1.285 million tons last month, said people familiar with data from the Energy Ministry, who spoke on condition of anonymity because the figures aren’t public.

That equates to 9.418m barrels a day, based on the typical 7.33 barrel-per-ton conversion ratio for the nation’s crude.

That means Russia’s crude output in April was about 219,000 barrels below March level, but still some 319,000 barrels above the level specified in its agreement with the Organization of Petroleum Exporting Countries.

Moscow had promised to put greater emphasis on production cuts, instead of export reductions, in a joint move to avert a global surplus and shore up prices.

Russia’s Energy Ministry didn’t immediately respond to requests for comment on the April and March crude-output figures.

Russia is the only OPEC+ nation splitting its curbs between production and exports of crude and refined products.

This quarter, Moscow promised to reduce its output more, while expanding its exports by a similar amount.

For April, Russia pledged to pump 350,000 barrels a day less than the prior month, which came on top of 500,000 barrels a day of production curbs announced in February 2023.

The country’s targeted daily production level for April was 9.099m barrels.

Russia has promised to deepen its total daily output cuts to 900,000 barrels and 971,000 barrels in May and June respectively.

That would put Russia’s total output curbs in the second quarter roughly in line with Saudi Arabia’s reductions.

OPEC+ is set to meet next month in Vienna to consider whether to prolong its cuts into the second half of the year.

Moscow classified its oil production data last year due to its sensitivity amid Western sanctions over the Kremlin’s aggression against Ukraine.

The ministry doesn’t disclose the tons-to-barrels conversion ratio it uses for its own assessment of monthly compliance, so the internal calculations may differ from those made by Bloomberg.

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