Oil demand in Russia stabilizes after initial war shock

Russian oil production is expected to exceed 480 million tons this year, in line with the 500,000 barrels per day reduction decided by Russia. Russia's decision to cut production could have a significant impact on the global oil market.

Share:

Russia ‘s oil production is expected to exceed 480 million tons this year, or about 9.6 million barrels per day (bpd), according to a knowledgeable Russian government source.

Russia’s combined oil and gas condensate production exceeds OPEC quotas+.

The figure is in line with Russia’s commitment to cut production by 500,000 bpd to 9.5 million bpd from March until the end of the year. The source said that if the current trend continues, production for the entire year will reach 480 million tons. The Russian Ministry of Energy has not yet commented on this issue.

In 2022, Russia’s combined oil and gas condensate production reached 535 million tons, or 10.7 million bpd, with condensate excluded from the production quotas used by the OPEC+ producer group for Russia.

However, this year’s production could reach about 520 million tons or 10.4 million bpd, taking into account 40 million tons of condensate gas, the source said. Official forecasts had projected Russia’s oil and gas condensate production for 2023 to be between 490 and 500 million tons (9.8 to 10 million bpd).

Russia’s decision to cut production could have a significant impact on the global oil market

Oil demand in Russia has stabilized after suffering an initial shock at the start of the war, according to analysts at J.P. Morgan. They also estimated that Russia’s overall production, including crude and condensate, was 10.8 million bpd in March, down 250,000 bpd from February.

Russia’s oil production declined in April 2022 after the West imposed sanctions due to the country’s military operation in Ukraine. Despite this setback, Russia has managed to successfully sell its oil to China and India. Nevertheless, Moscow has decided to cut crude oil production by 500,000 bpd until the end of the year to support the price of oil, which is the main source of income for the Russian economy.

The lack of transparent official data from one of the world’s largest oil producers makes it more difficult to monitor global supply and analyze markets, according to analysts at J.P. Morgan in a research note. Russia’s decision to cut production could have a significant impact on the global oil market, and it remains to be seen how this will affect prices and supply in the coming months.

Petro-Victory Energy announces the completion of drilling operations for the AND-5 well in the Andorinha field, Brazil, with positive reservoir results and next steps for production.
The Colombian prosecutor’s office has seized two offices belonging to the oil company Perenco in Bogotá. The company is accused of financing the United Self-Defense Forces of Colombia (AUC) in exchange for security services between 1997 and 2005.
Indonesia has signed a memorandum of understanding with the United States to increase its energy imports. This deal, involving Pertamina, aims to diversify the country's energy supply sources.
VAALCO Energy continues to operate the Baobab field by renovating its floating platform, despite modest production. This strategy aims to maintain stable profitability at low cost.
An empty reservoir exploded at a Lukoil-Perm oil facility in Russia, causing no injuries according to initial assessments pointing to a chemical reaction with oxygen as the cause of the accident.
The British Lindsey refinery has resumed fuel deliveries after reaching a temporary agreement to continue operations, while the future of this strategic site remains under insolvency proceedings.
BP and Shell intensify their commitments in Libya with new agreements aimed at revitalizing major oil field production, amid persistent instability but rising output in recent months.
The private OCP pipeline has resumed operations in Ecuador following an interruption caused by heavy rains, while the main SOTE pipeline remains shut down, continuing to impact oil exports from the South American country.
McDermott secures contract worth up to $50 million with BRAVA Energia to install subsea equipment on the Papa-Terra and Atlanta oil fields off the Brazilian coast.
Saudi Aramco increases its oil prices for Asia beyond initial expectations, reflecting strategic adjustments related to OPEC+ production and regional geopolitical uncertainties, with potential implications for Asian markets.
A bulk carrier operated by a Greek company sailing under a Liberian flag suffered a coordinated attack involving small arms and explosive drones, prompting an Israeli military response against Yemen's Houthis.
The Canadian government is now awaiting a concrete private-sector proposal to develop a new oil pipeline connecting Alberta to the Pacific coast, following recent legislation intended to expedite energy projects.
Petrobras is exploring various strategies for its Polo Bahia oil hub, including potentially selling it, as current profitability is challenged by oil prices around $65 per barrel.
Brazilian producer Azevedo & Travassos will issue new shares to buy Petro-Victory and its forty-nine concessions, consolidating its onshore presence while taking on net debt of about USD39.5mn.
Major oil producers accelerate their return to the market, raising their August quotas more sharply than initially expected, prompting questions about future market balances.
Lindsey refinery could halt operations within three weeks due to limited crude oil reserves, according to a recent analysis by energy consultancy Wood Mackenzie, highlighting an immediate slowdown in production.
The flow of crude between the Hamada field and the Zawiya refinery has resumed after emergency repairs, illustrating the mounting pressure on Libya’s ageing pipeline network that threatens the stability of domestic supply.
Libreville is intensifying the promotion of deep-water blocks, still seventy-two % unexplored, to offset the two hundred thousand barrels-per-day production drop recorded last year, according to GlobalData.
The African Export-Import Bank extends the Nigerian oil company’s facility, providing room to accelerate drilling and modernisation by 2029 as international lenders scale back hydrocarbon exposure.
Petronas begins a three-well exploratory drilling campaign offshore Suriname, deploying a Noble rig after securing an environmental permit and closely collaborating with state-owned company Staatsolie.