Page 6 - FSUOGM Week 01 2020

FSUOGM COMMENTARY FSUOGM
Russian oil output breaks another post-Soviet record
Russian oil production has seen 11 years of consecutive growth, but 2020 could mark a turning point
RUSSIA
WHAT:
Russian liquids output reached 11.25mn bpd in 2019, a post-Soviet record.
WHY:
Output has continued to surge despite Russia’s OPEC+ commitments.
WHAT NEXT:
Russia’s latest cut pledge does not include condensate, though output is still likely to fall or remain flat in 2020.
RUSSIAN oil production reached a post-Soviet high in 2019, despite Moscow’s commitments under the so-called OPEC+ production cuts, according to preliminary data from the energy ministry’s CDU-TEK unit.
Russia produced 560.2mn tonnes (11.25mn barrels per day) of oil and condensate in 2019, up 0.8% from the previous year. The only time Russia produced more was towards the end of the Soviet era in 1987, when a record 11.416mn bpd was pumped, according to BP data.
Russia’s oil exports also reached 266.1mn tonnes in 2019, which is 3.3% more than a year earlier, the Central Dispatching Department of Fuel Energy Complex reported.
Russian oil production has growing for 11 consecutive years and even the government’s pledge to cut 228,000 bpd from an October 2018 baseline of 11.42mn bpd under an agreement
with OPEC and other producers has not held back this growth.
Russia was one of the architects of the original 2016 OPEC+ deal, but has not stuck to its com- mitments. Russia’s energy ministry explained the 2019 record result away, blaming the limitations of a harsh climate and technical issues after the Druzhba oil-contamination crisis.
Russia’s oil supplies to non-CIS countries grew by 3.7% in 2019 to reach 248.5mn tonnes, while deliveries to CIS countries dropped by 2.4% to 17.6mn tonnes. Oil transit rose by 7.2% to 19.8mn tonnes. Meanwhile, oil exports to non-CIS countries declined 6.3% to 20.1mn tonnes in December, while exports to CIS coun- tries grew 9.7% to 1.7mn tonnes. In 2019, oil supplies to the domestic market decreased by 0.4% to 290.14mn tonnes, and in December, by 1.5% to 25mn tonnes.
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