Russia yet to finalize stance before OPEC+ considers deeper oil cuts

Russia agreed to reduce output by 228,000 barrels per day (bpd) to about 11.18 million bpd in 2019 as part of cuts agreed by the group known as OPEC+. (AFP)
Updated 03 December 2019

Russia yet to finalize stance before OPEC+ considers deeper oil cuts

  • Russia agreed to reduce output by 228,000 barrels per day to about 11.18 million bpd in 2019
  • But it pumped more than its quota in November, producing 11.244 million bpd

MOSCOW: Russian Energy Minister Alexander Novak said on Tuesday he expected this week’s meeting of OPEC oil producers and their allies to be constructive but said Moscow had yet to finalize its position in talks on possible additional supply curbs.
Russia agreed to reduce output by 228,000 barrels per day (bpd) to about 11.18 million bpd in 2019 as part of cuts agreed by the group known as OPEC+. But it pumped more than its quota in November, producing 11.244 million bpd.
The Organization of the Petroleum Exporting Countries, Russia and other producers, which previously agreed to reduce combined output by 1.2 million bpd or 1.2 percent of global demand until March, hold discussions in Vienna on Thursday and Friday.
“I will not tell you anything now as we are still finalizing our position,” Novak told reporters. “Let’s wait ... But I think the meeting, as usual, will be of constructive nature.”
Two sources said on Monday that OPEC+ was discussing cutting output by at least an additional 400,000 bpd, as Riyadh seeks high oil prices to balance its budget and help Thursday’s pricing for Saudi Aramco’s initial public offering (IPO). The Saudis have been lobbying others to deepen cuts.
Novak said Russia’s average cut was 195,000 bpd in November and said Moscow aimed to comply fully with the quota in December.
Russia earlier called for a change to the way its output is measured to exclude gas condensate, which accounts for about 7 percent-8 percent of Russia’s total oil production, or about 800,000 bpd.
Novak told reporters he planned to discuss excluding condensate from Moscow’s quotas at the OPEC+ meeting.
By excluding condensate and only taking into account oil production, Novak said Russia’s output could be about 225,000 bpd to 230,000 bpd less in December.
“That said, we will discuss with our colleagues to take into account our statistics the same way as for OPEC countries — excluding condensate,” the minister said.
Vagit Alekperov, chief executive of Russia’s No.2 oil producer Lukoil, said in comments broadcast on Tuesday that it would not be expedient to deepen global oil production cuts in the winter season, especially for Russia.
Russian data cites production in tons. Reuters uses a conversion rate of 7.33 barrels per ton of oil.


Riyadh to host next World Economic Forum regional summit

Updated 45 min 56 sec ago

Riyadh to host next World Economic Forum regional summit

  • The theme of the meeting will be the place of the region in the fourth industrial revolution
  • Middle East WEF’s in the past have been staged in Egypt, Jordan and some have been held in the UAE

DAVOS: Saudi Arabia will host the next Middle East summit of the World Economic Forum, the first time the Kingdom has staged the prestigious meeting of world leaders, it was announced in Davos on Thursday.

Borge Brende, the WEF president, told delegates: “The next Middle East summit will be held in Saudi Arabia on the 5 and 6 of April this year.”

The theme of the meeting will be the place of the region in the fourth industrial revolution, according to a posting on the official WEF website.

Middle East WEF’s in the past have been staged in Egypt, Jordan and some have been held in the UAE.

The announcement was made at a special meeting at Davos to consider the strategic priorities for Saudi Arabia as it prepares to stage the G20 meeting of world leaders in the Kingdom in November, the first time the power-summit has been held in the Middle East.