Russia’s crude oil production will go down by around 10% in 2020 due to OPEC+ restrictions compared with 2019 when it reached the record 560.2 million tons, Energy Minister Alexander Novak said at a meeting on energy development issues headed by President Vladimir Putin on Wednesday.
“Currently companies are preparing for cutting production. In May, the reduction will amount to roughly 19% compared with the level of February 2020. Considering the work of first four months and a gradual decrease in reduction volumes, output volumes are planned to be reduced by around 10% by the end of the year compared with last year,” he said.
Speaking about the situation in the European market, Novak said Russia is seeing tentative signs of recovery in fuel demand in this important market.
OPEC+, set up in 2016, has worked to support prices by cutting output. But Russia and others have long complained that this has mainly benefited U.S. producers which have ramped up output and snatched market share.
Russia and OPEC member Saudi Arabia spearheaded the latest efforts by OPEC+ to cut production by the equivalent of 10% of global supplies from May 1 in a bid lift prices as demand for crude plunged by as much 30% due to global lockdowns.
The deal seeks to reduce a glut of oil that is struggling to find a home as global storage facilities rapidly fill.
Riyadh, Moscow and other OPEC+ members have also pushed for curbs from other producers, particularly the United States.