Russian Oil, Gas Production Rises This Year Despite Setbacks

Despite decreased flows relating to the oil contamination crisis and a recent dip in gas exports, Russian oil and gas production climbed further in the first seven months of 2019, bneIntellinews reported citing data published by the energy ministry’s CDU TEK department.

From January to July, crude oil and condensate output grew by 2% year on year to more than 325 million tons (11.2 million barrels per day), the data shows. Extraction was down 0.6% year on year in July, however, at 47.15 million tons.

In May, after it was found that millions of barrels of crude had been contaminated with organic chlorides, exports via the Druzhba pipeline were disrupted in May, slumping 10.7% to 11.11 million barrels per day.

It then fell to a three-year low of 10.8 million barrels per day in early July, after national pipeline operator Transneft stopped receiving oil from state-owned producer Rosneft. The move was believed to be part of a larger dispute between the pair over efforts to resolve the contamination crisis.

Overall production for July came to 47.15 million tons (11.15 million barrels per day), according to CDU TEK, indicating that supply bounced back during the second half of the month. But this still marked a 0.6% decline on the amount produced in July last year.

Rosneft produced 112.8 million tons in the first seven months of 2019, while leading private oil companies Lukoil and Surgutneftegaz produced 47.9 million tons and 35.1 million tons respectively.

Meanwhile, Russian gas production increased 3% year on year from January to July at 431.9 billion cubic meters, according to CDU TEK. The output for July alone was 54.66 billion cubic meters, up 0.5% year on year.

These gains came despite a 5.6% year on year slump in state-owned supplier Gazprom’s exports countries outside the former Soviet Union between Jan. 1 and Jul. 15, down to 102.8 billion cubic meters. The company’s output was unaffected by weaker European sales, rising 1.9% year on year to 294.5 billion cubic meters.