Russian Daily Oil Production Stays at Post-Soviet High in June

Reuters

MOSCOW, July 2 (Reuters) – Russian oil output remained at post-Soviet high of 10.71 million barrels per day (bpd) in June for a fourth month in a row, supported by strong production by mid-sized producers, Energy Ministry data showed on Thursday.

Russian oil and gas condensate production hit the latest in a string of post-Soviet highs in March and has since stayed at that level, feeding exports and adding to a global glut preventing global oil prices from rising. Russia produced 43.824 million tonnes of oil last month versus 45.288 million in May. Gas production was at 42.58 billion cubic metres (bcm) last month, or 1.42 bcm a day, versus 48.28 bcm in May.

Russian seaborne oil exports rose 2.8 percent in June from May. Production was supported by increases at Novatek, Russia's second-largest gas producer, and mid-sized oil producer Tatneft, the data showed. OPEC decided to keep oil output unchanged last month – a decision partly affected by non-OPEC producers like Russia refusing to join output cuts to support prices. Instead, OPEC supply and Russian output are at highs. Russian officials have said oil companies are likely to cut investments by 10-15 percent because of lower oil prices, but so far production has not been affected.

"Because of the low oil price, up to 10 percent of previously planned investments in the oil sector have been delayed or put on ice... But in the first five months, we made 10 percent more exploration drilling," Alexander Novak, Russian energy minister, told German business daily Handelsblatt in an interview on Thursday.

But Lukoil Chief Executive Vagit Alekperov said last month that production could fall in the near future as new oil regions would not offset declining output at maturing fields.

(Reporting by Katya Golubkova; additional reporting by Vera Eckert in Frankfurt; Editing by Alexander Winning)

Copyright 2016 Thomson Reuters. Click for Restrictions.

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