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Russia will speed up its oil production cuts this month and plans to reach its share of the OPEC/non-OPEC output reduction by end-March or early April, Russian Energy Minister Alexander Novak said on Monday.
There is an understanding that Russia will reach higher compliance levels in March, Novak said, as carried by Russian news agency TASS. At the end of March-early April, Russia will have reached the planned reduction, 228,000 bpd, Novak added.
As part of the OPEC+ production cuts between January and June, Russia is taking the lion’s share of the non-OPEC cuts and pledged to reduce production by 230,000 bpd from October’s post-Soviet record level of 11.421 million bpd, to 11.191 million bpd.
Moscow, however, has repeatedly said that due to weather and geological conditions in the cold Russian winter, it cannot cut its oil production too quickly.
In mid-January, Khalid al-Falih, the energy minister of Saudi Arabia—the OPEC kingpin and key Russian ally in all OPEC/non-OPEC production policy deals since early 2017—had said that Russia was moving with the cuts “slower than I’d like.”
Referring to Russia’s share of the cuts, Novak said last month that as of February 14, the country had reduced its production by 80,000 bpd-90,000 bpd from October’s levels. Novak said last month that the Russian companies would try to accelerate the cuts to reach the target by April.
Last Friday, the minister held a meeting with Russia’s oil companies to discuss the cuts and the situation on the oil market.
Russia is fully complying with its pledges to gradually reduce production, Novak said, as carried by the Russian energy ministry. In February, Russia cut its oil production by around 97,000 bpd compared to October levels, and as of end-February, the country had cut a total of 118,000 bpd compared to October 2018, the energy minister said on Friday.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.