...

Russia to increase oil production if OPEC deal not extended

Oil&Gas Materials 26 April 2017 17:07 (UTC +04:00)

Baku, Azerbaijan, Apr. 26

By Elena Kosolapova – Trend:

If the oil production cut agreement concluded in late 2016 between OPEC countries and other oil producers is not extended, Russia will very quickly increase oil production in the second half of 2017, said Sergey Agibalov, senior expert at the Department of Economics of the Russian Institute for Energy and Finance.

He made the remarks during ‘The 2nd SOCAR International Caspian and Central Asia Downstream Forum – Trading, Logistics, Refining, Petrochemicals’, held in Baku Apr. 26.

Agibalov said that in recent years, oil production in Russia was steadily growing and reached a record level of 548.6 million tons in 2016.

He noted that significant capital expenditures in 2010-2014 and the introduction of various tax incentives in Russia contributed to the growth in oil production.

Agibalov noted that there are no restrictions for further growth of oil production in Russia, and if not for the agreement with OPEC, the oil production would continue to remain at the maximum level, even given low prices.

He added that if the situation with oil prices doesn’t change significantly and the prices remain at a level exceeding $50 per barrel, the oil production cut agreement is unlikely to be prolonged.

During a meeting in Vienna, Austria, on Nov. 30, 2016, OPEC members decided to cut oil production to 32.5 million barrels per day. Later, non-OPEC countries agreed to reduce the output by another 558,000 barrels per day during the meeting held Dec. 10, 2016.

Eleven non-OPEC countries – Azerbaijan, Bahrain, Brunei, Equatorial Guinea, Kazakhstan, Malaysia, Mexico, Oman, Russia, Sudan, and South Sudan – agreed to reduce the oil output.

OPEC and non-OPEC countries pledged to start implementing the deal from Jan. 1, 2017 for six months, extendable for another six months.

Tags:
Latest

Latest