Russia plans to cut its oil output by at least 50,000 to 60,000 barrels per day (bbl/d) in January, its energy minister said on Dec. 11, less than its final target under a global production deal reached last week, aiming for gradual, smooth reductions.
This would mean Russian oil output coming in at around 11.35 MMbbl/d next month, off the post Soviet-record high of 11.41 MMbbl/d reached in October and down from 11.37 MMbbl/d last month.
Energy Minister Alexander Novak reiterated to reporters that the country planned to cut its oil output gradually.
"Everything will depend on technological and climate possibilities. We will get proposals from the companies," Novak said.
"We will see how the situation would evolve," added Novak, who is a part of Russian Prime Minister Dmitry Medvedev's delegation to the Arctic Yamal peninsula where local gas producer Novatek is expanding liquefied natural gas production.
OPEC and some non-OPEC producers including Russia last week said they would curb oil output by a combined 1.2 MMbbl/d.
They are looking to prop up oil prices that plummeted below $60 per bbl from a four-year high above $85 hit in October on oversupply worries.
Of that, Russia undertook to cut 228,000 bbl/d.
According to the initial agreement between OPEC and other producers, reached in late 2016, Russia also had to gradually cut its oil production, by 300,000 bbl/d from 11.247 MMbbl/d reached in October that year.
"It was not that gradual two years ago, there were jumps (in output reduction) in January because of the weather. We will watch and monitor," Novak said.
Kirill Dmitriev, the head of the Russian Direct Investment Fund, welcomed last-week deal, saying it is conducive with "strengthening of Russia's macroeconomic stability".
Drillers cut nine oil rigs in the week to March 22, bringing the total count down to 824, the lowest since April 2018, Baker Hughes, a GE company (NYSE: BHGE), said in its weekly report.
The independent U.S. energy producer aims to take a final investment decision on the $20 billion project in the coming months, having signed up long-term buyers for its LNG.
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