Page 15 - FSUOGM Week 22
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FSUOGM PERFORMANCE FSUOGM
Russia nears OPEC+ oil output goal in May
RUSSIA
Data indicates that Russia missed the target by around 200,000 bpd.
RUSSIA slashed its oil and gas condensate pro- duction to 39.6mn tonnes (9.39mn barrels per day) in May, Energy Ministry data shows, just above its target under the OPEC+ deal on out- put cuts.
Under a pact made by the OPEC+ alliance of producers, Russia pledged to lower its oil extrac- tion by around 2.5mn bpd to 8.5mn bpd in May and June, in an effort to prop up oil prices. The deal does not apply to condensate flows, how- ever, which typically range between 700,000 and 800,000 bpd. The energy ministry does not report separate figures for monthly oil and condensate.
VTB Capital (VBTC) estimates Russia’s oil- only output last month at 8.7mn bpd, versus a 10.54mn bpd average in the first quarter. In terms of overall liquids production, the bank calculates that producers Surgutneftegaz, Lukoil and Gazprom Neft cut supply by 22.8%, 20.6% and 20.1% respectively month on month in May. Tatneft lowered output by only 1.3% m/m, as it had already started cutting back in April.
Meanwhile Rosneft, Russia’s biggest oil pro- ducer, slashed its output by 15.7%, according to VTBC, excluding contributions from its
Bashneft subsidiary, which cut supply by 24%. Recent reports suggest Rosneft is struggling to meet supply commitments with both its domes- tic and foreign customers as a result of the cuts.
As for Rosneft’s other major subsidiaries, Yuganskneftegaz’s production dropped by 19.6% and Vankorneft’s by 9.2%. Large declines were also recorded at Uvatneftegaz, Nyaganneftegaz and at brownfields in Central Russia.
Gazprom Neft, Russia’s third largest oil com- pany, scaled back output significantly at Noya- brskneftegaz, following growth in April, while Lukoil cut yields in Western Siberia and the Komi region by 25%.
Russian gas production, while not subject to any restrictions, declined 16.9% year on year in May, continuing a trend that began earlier this year. Russia’s top gas producer Gazprom started seeing sales in Europe slump even before coro- navirus (COVID-19) lockdowns were imposed, amid unusually warm weather, high storage lev- els and competition from LNG.
Gazprom’s output was down 21.4% y/y last month, while number two producer Novatek, saw a decline of only 3.1%. Gas production at Lukoil, Surgutneftegas and Rosneft shrank by 1.1%, 12% and 3.4% respectively.
Week 22 03•June•2020 w w w . N E W S B A S E . c o m P15
