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Home News Russia says to meet oil output cut deal by April

Russia says to meet oil output cut deal by April

Published on 16/02/2017

Russia said Thursday it will fully comply with an oil output cut agreement with other oil producing countries by the end of April.

Under the deal with OPEC and non-OPEC countries signed last year Russia pledged to reduce its crude output by 300,000 barrels per day as part of a concerted effort to combat a global oil glut.

“We can get to 300,000 barrels per day at great speed by the end of April,” Energy Minister Alexander Novak told the Interfax news agency.

“This will allow us in May to produce exactly 300,000 less per day than in October.”

In December, the Organization of the Petroleum Exporting Countries agreed with 11 non-members, including Russia, to cut output in the first half of this year to push prices higher.

Russia, which has suffered badly from oil price declines, was pumping oil at a record-breaking level of over 11 million barrels per day at the end of last year.

Novak said Russian production was currently down by more than 100,000 barrels per day and should be 150,000 barrels per day lower in March.

Technical issues affecting Russia’s production were stopping the country from going to the agreed level immediately, Novak said.

The OPEC oil cartel, meanwhile, has implemented 92 percent of its agreed output cuts, Kuwait’s oil minister said on Monday.

Non-OPEC producers had delivered on more than half of their pledged production reductions, said the minister, Essam al-Marzouk, who chairs a committee tasked with monitoring the agreement.

Novak said Thursday an oil price recovery since the agreement could boost Russian oil producers’ earnings by 700 billion rubles ($12.2 billion, 11.5 billion euros) this year and add 1.5 trillion rubles to the state’s budget.

Brent crude oil stood at $55.76 per barrel on Thursday, up 1 cent on the day, while WTI was up 7 cents at $53.17.

Oil prices are now up to 20 percent higher than they were three months ago.