Page 81 - bne IntelliNews monthly country report Russia February 2024

In addition, Russia said it would cut its oil exports by 500,000 b/d in the first quarter next year compared with May-June 2023 levels. This is deeper than its current 300,000 b/d cut although it includes 200,000 b/d of refined products.
Saudi Arabia, which has done much of the heavy lifting in terms of Opec+ production cuts in the past year, has agreed to a three-month extension of the 1mn b/d reduction that it announced in June and began implementing in July.
"In order to support market stability, these voluntary cuts will be returned gradually subject to market conditions," Opec said.
Crude prices have retreated more than 20% since nearing $100 a barrel in late September as of December. The slide reflects a number of factors, including new US production records, Guyana’s emergence as a key player and Iran’s startling comeback.
As a result, traders’ expectations for a hefty supply deficit this quarter and a year-end rally have melted away, leaving the market to grapple with signs of a renewed surplus.
As the latest predictions from the International Energy Agency show, those bearish forces are now being compounded by slowing demand.
The Paris-based adviser slashed estimates for demand growth in the fourth quarter by a substantial amount — 400,000 barrels a day — as economic activity disappoints in Europe, Russia and the Middle East amid high interest rates around the world.
The alarming detail for bullish traders is that, with the turn of the year, fundamentals seem likely to soften further.
Growth in world oil consumption is set to decelerate by roughly 50% in 2024 to just over 1 million barrels a day as the post-pandemic rebound loses momentum and consumers increasingly turn to more efficient, including electric, vehicles.
● Transport & exports
Exports of ESPO grade oil from the port of Kozmino increased in December to a record 925 thousand barrels per day, according to Kpler data available to Kommersant. 85% of this volume was supplied to China. In November, Russian oil exports from Kozmino amounted to 910 thousand bpd (about 3.69 million tons). If the current level of supplies continues, the volume of exports from Kozmino in December could reach about 3.88 million tons.
The cost of shipping from China to Europe is back to pre-pandemic levels. This chart is relevant in understanding the supply-driven inflation
81 RUSSIA Country Report February 2024 www.intellinews.com