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Russian Oil Output Remains High Much To OPEC's Dismay

Russian crude oil export data in recent weeks have not reflected any cuts and OPEC+ allies are increasingly frustrated with its non-compliance

Russia's crude oil exports by sea continue to stay high as the latest four-week average shows that shipments are inching up, much to the frustration of its partners in the OPEC+ deal.

In the four weeks to June 4, the four-week average Russian crude exports by sea rose to 3.73 million barrels per day (bpd), up from a revised 3.68 million bpd in the four weeks to May 28, tanker-tracking data monitored by Bloomberg showed on Tuesday.  

Russian crude oil shipments are 1.4 million bpd above the level from the end of 2022, more than can be accounted for by Germany and Poland stopping Russian crude imports by pipeline, or lower refinery throughput, Bloomberg's Julian Lee notes. 

On Sunday, the OPEC+ producers decided to keep the current cuts until the end of 2024, while OPEC's top producer and the world's largest crude oil exporter, Saudi Arabia, said it would voluntarily reduce its production by 1 million bpd in July, to around 9 million bpd.

Russia has said it would reduce its oil production by 500,000 bpd from March. The 500,000 bpd cuts will now extend until the end of 2023, and after Sunday's meeting - to the end of 2024.  

However, Russian crude oil export data in recent weeks have not reflected any cuts-on the contrary, Russian crude oil exports by sea have been rising. 

It looks like Saudi Arabia is fed up with a lack of clarity about Russia's actual production levels and higher supply to the Asian markets, which is hampering the Saudi attempts to raise oil prices.

Russia has stopped reporting oil production levels, and the market and analysts have to rely on vessel-tracking data, trade sources, and import statistics in China and India about the amount of Russian supply. 

After the OPEC+ meeting in Vienna this weekend, Saudi Energy Minister Prince Abdulaziz bin Salman said, referring to Russia, "We discussed with Russia the issue of its production and asked it to clarify its data, and we have strengthened the concept of transparency with Russia about its oil production figures."

By Tom Kool for Oilprice.com

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Tom Kool

Tom majored in International Business at Amsterdam’s Higher School of Economics, he is Oilprice.com's Head of Operations More