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Why Russia can not accelerate production cuts



Russia's crude oil production stood at 11.24 million Bpd for the first 18 days of April, Reuters reported Friday citing an industry source. This means that the leader of the non-OPEC group of the OPEC + agreement does not yet have to agree with the promised production cuts.

As part of OPEC + production cuts between January and June, Russia takes the lion's share. Non-OPEC lowers and promises to cut production by 230,000 barrels per day from the post-soviet record level of 11,421 million barrels per day to 11,191 million barrels per day Lower day.

Moscow has repeatedly said that the weather conditions and geological conditions in the cold Russian winter Oil production can not be lowered too fast.

Russia gradually reduced oil production in March, but missed its production cut target, according to the Russian Ministry of Energy.

Standstill In March, Russia reduced its oil production by 225,000 bpd compared to October, excluding production from PSAs, while production had fallen by 1

90,000 bpd compared to October when PSAs were considered nergy minister Alexander Novak said in a statement by the Department of Energy.

Russian production reached 11.298 million bpd in March, according to the Department of Energy in tons, calculated by Reuters in millions of bpd at a ratio of 7.33 b / d.

In early March, Novak said Russia would accelerate production Oil production is reducing and planning to reach its share of OPEC / non-OPEC production reduction by the end of March or early April. Related: Great interest in oil and gas defies this "millennial" investment trend

In recent weeks, reports have tightened that Russia may not like the production cutback with OPEC extended its expiry in June.

Moscow plans to use its National Wealth Fund for $ 3.3 billion (210 billion rubles) this year to pay oil companies under an agreement to keep gasoline and diesel prices down, Alexey Sazanov , Chief of said the Finance Department of the Russian Ministry of Finance on Friday.

In November 2018, after the oil price reached a four-year high in the previous month, the Russian government and domestic oil companies and refineries agreed to freeze fuel prices to keep prices high – a politically sensitive issue for the Russian President Vladimir Putin, who had lowered his agreement to a low in 2012 with an increase in retirement age and higher prices at the pump, which had leaked through inflation.

By Tsvetana Paraskova for Oilprice.com

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