By October 20, 2016 Read More →

Russian oil output could be raised: Sechin

Russian oil output

Russian oil output jumped by almost four per cent in September to 11.11 million b/d. Bloomberg photo.

Russian oil output could increase by 4 million b/d

 By Oksana Kobzeva

VERONA, Italy, Oct 20 (Reuters) – Russian oil output in the future could be raised by up to 200 million tonnes a year, or 4 million barrels per day, Rosneft’s chief executive Igor Sechin said on Thursday.

Russia, the world’s top oil producer, and OPEC are seeking a way to cooperate to prop up oil prices, hit by global oversupply. But consensus must first be found inside OPEC for Moscow to join, officials have said.

OPEC agreed in Algiers on Sept. 28 to reduce production to a range of 32.5 million to 33 million barrels per day, which would be its first output cut since 2008. Another meeting on Nov. 30 is set to firm up details of the accord.

“In the next year and a half we should see the end of surplus (on global oil markets) and the start of the process of the situation normalising,” Sechin told a forum in Italy, adding that he saw oil prices rising to above $55 per barrel by then.

Russian oil output jumped by almost 4 per cent in September from the previous month to 11.11 million barrels per day (b/d), a new post-Soviet record-high, as companies ramped up drilling amid improved oil prices.

Russian officials have said that Moscow would rather freeze oil output than cut, but the level is yet to be agreed. Russia’s biggest oil companies such as Rosneft, Gazprom Neft and Lukoil are launching new fields in 2016.

“If the market needs it and there are technological and economic grounds, Russia may significantly increase oil production in the future by up to 200 million tonnes,” Sechin told the forum. He did not give a time frame for the increase.

Last year Sechin said Russia could raise oil production to over 14 million b/d in the next two decades.

Russian Energy Minister Alexander Novak plans to meet his Saudi counterpart Khalid al-Falih this weekend to discuss coordination of possible actions on the global oil market.

Gazprom Neft, the oil arm of Russian state gas firm Gazprom, could slow its oil output growth compared with the current plan if needed, its Chief Executive Alexander Dyukov told Rossiya 24 TV in an interview broadcast on Tuesday.

(Reporting by Oksana Kobzeva; Additional reporting by Giancarlo Navach; writing by Katya Golubkova; Editing by Maria Kiselyova and Adrian Croft)

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