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Russia is estimated to have increased its crude oil production by 0.2 percent in February compared to January, but it is still likely more than 130,000 barrels per day (bpd) below its quota per the OPEC+ agreement, according to Bloomberg estimates of Russian production data.
February was the third consecutive month in which Russia did not pump to its quota under the OPEC+ deal, after it started lagging in output levels in December 2021, for the first time since the April 2020 pact that put an end to a month-long price war with Saudi Arabia when COVID crippled global demand.
Russia’s difficulties in producing to its quota add to the already very tight oil market, which has seen prices soaring above $110 a barrel after Russia invaded Ukraine and traders and buyers started shunning Russian cargos, even if Russia’s crude is not subject to sanctions currently.
Russia doesn’t differentiate between crude oil production and condensate production in its official output figures. After years of debates within the OPEC+ group, Russia has won an exemption not to consider its condensate output as part of the production cut agreement.
According to data from the Russian energy ministry in tons converted into barrels, Russia’s crude oil production was around 10.095 million bpd in February, which was 132,000 bpd under its quota for the month, Bloomberg calculations show.
Under the OPEC+ deal, Russia’s quota for February was 10.227 million bpd, the same as Saudi Arabia’s. The two leaders of the OPEC+ group are allowed to add around 100,000 bpd each to their production every month as part of the 400,000-bpd monthly increases.
OPEC+ met on Wednesday and not to break from its plan to add 400,000 bpd to quotas each month, largely as expected, despite soaring oil prices amid Russia’s invasion of Ukraine.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com