Russia’s oil production increased in March amid more generous OPEC + quota

Photographer: Andrey Rudakov / Bloomberg

Russia increased oil production in March under a more generous OPEC + quota, even as rising coronavirus cases threaten near-term demand for oil.

The country pumped 43.34 million tonnes of crude and condensate last month, according to preliminary data from the Energy Ministry’s CDU-TEK unit. This equates to 10.249 million barrels per day, based on a conversion rate of 7.33 barrels per tonne, which is 1.3% more than in February.

The CDU-TEK does not provide a breakdown between crude and condensate – a light oil extracted from natural gas, which is excluded from the OPEC + deal, and it is difficult to assess Russia’s compliance. If the March condensate outlet was in accordance with In February, daily crude production alone would be around 9.41 million barrels per day, some 165,000 barrels above its OPEC + quota.

From February to April, Russia and its neighbor Kazakhstan are the only two countries allowed to pump more under the agreement between the Organization of the Petroleum Exporting Countries and its partners. Russia’s quota increased by 65,000 barrels per day in March, after increasing by the same amount in February, and will increase a further 130,000 barrels per day in April. Saudi Arabia has voluntarily taken 1 million barrels per day from the market.

OPEC + reached a deal on Thursday to gradually ramp up production from May to July, adding a total of more than 2 million barrels per day to global supplies, with the agreed ramp-up schedule still subject to monthly revisions. This includes the gradual reduction of Saudi Arabia’s voluntary cutback over the next three months.

Even as Europe tightens lockdowns amid third wave of coronavirus, data from US and Asia support the alliance’s decision to put the barrels back on the market.

Russia to step up production “Uniformly” a total of 114,000 barrels per day in May-July, according to Deputy Prime Minister Alexander Novak. This will allow the nation to meet its production quota under the original OPEC + schedule set last year.