Page 129 - RusRPTApr21

Exports to China via Power of Siberia were up 3.2x y/y, but this was mostly due to the company’s ramp-up schedule, with production from 1 January to 15 March up 8.4% y/y to 112.4bcm.
Gazprom also booked additional transit volumes via Ukraine for April, according to Regional Booking Platform. The TTF Day Ahead price is still up from this year’s lows ($200/mcm) at around $227/mcm. At this time last year, prices were at $103/mcm. Underground storage in Europe is 32% full vs. 56% full at this time in 2020, according to GIE data.
The targeted completion date of NS2 has moved from late April to September Kommersant and others reported. The date was moved even as the 2nd pipe-laying ship, the Akademik Chersky, joins the Fortuna at the job site. A key catalyst delayed – negative, though in part expected. We had thought the April date was somewhat aggressive, and had pinned June as a more likely finish date. In any event, we did not expect actual gas shipments to begin via the line in the near future, as we expect US sanctions will complicate the inspection and certification process for some period of time. Regardless, this is negative news for GAZP, as the physical completion of Nord Stream-2 is one of three catalysts we are watching for the buy-rated, Top Pick stock.
Russia might increase oil production 890kbbl/d y/y in May, or some 150kbbl/d growth m/m. Global oil demand is to recover 5.5mmbbl/d in 2021, according to Deputy Prime Minister Alexander Novak, Interfax quotes. The estimated current oil supply deficit of 1-2mmbbl/d might lead to a five-year low global oil stock within 70-140 days. The final oil demand recovery is expected in 2022. According to Bloomberg, Russian oil output might grow 890kbbl/d y/y in May. Earlier, Russia was allowed to increase oil production 130kbbl/d in April, while other OPEC+ countries (excluding Kazakhstan) decided to keep the production quotas for April unchanged from their current levels (two days before, OPEC+ had discussed a 500kbbl/d increase in production in April as a base case scenario, and Saudi Arabia was prepared to reverse its voluntary production cut of 1mmbbl/d either fully or partially). After Russia was allowed to increase oil production 125kbbl/d in January, 65kbbl/d in February and March, and 130kbbl/d in April, the country has 115kbbl/d left from the 500kbbl/d production quota softening set by the OPEC+ agreement back in December 2020 (assumed to take place in January 2021, but postponed later). At the same time, an oil production increase of 890kbbl/d y/y is equivalent to some 150kbbl/d m/m growth in May 2021 (or 35kbbl/d above the quota on an accumulative basis). Were oil production to stay at the May level, total liquids production in Russia might grow 0.7% y/y to 515mnt in 2021, we calculate. Overall, we see the news as not market moving for the sector.
Russia’s energy major Gazprom said on March 1 that it had pumped more gas to China in February via the Power of Siberia pipeline than it had initially planned, more than tripling supplies compared to the same
129 RUSSIA Country Report April 2021 www.intellinews.com