Russian oil production decrease exceeds OPEC supply cut pledge

Russian oil production is down to 10.947 million b/d, and is in line with the OPEC supply cut agreement. 

Russian oil production down by 300,790 b/d

On May 1, Russian oil production was down 300,790 barrels per day (b/d) below October’s output, more than Russia had pledged to cut in the OPEC supply cut pact, according to the Russian Energy Ministry on Wednesday.

According to the OPEC deal, most cartel members along with some non-members, including Russia had agreed to cut production by a total of 1.8 million b/d during the first six months of 2017.

Russia had agreed to gradually reach a reduction of 300,000 b/d to 10.947 million b/d from October levels.

Despite high compliance with the agreement, the global oil supply inventories are still bulging.  Investors are now waiting to see if OPEC will extend the cuts into the second half of the year.

OPEC will meet in Vienna to discuss the pact at the end of May.  Russian Energy Minister Alexander Novak will meet with his country’s major oil company managers prior to discussing Russia’s possible participation in an extension of the cuts.

Reuters reports Novak has declined to comment on the possible deal extension and Russia’s Deputy Prime Minister Arkady Dvorkovich also declined to comment.