Russian Oil Output Highest In 30 Years Ahead Of Doha Meeting

Russia’s oil production rose 0.3 percent to 10.91 million barrels per day in March, its highest level in nearly 30 years, raising questions over Moscow’s commitment to freeze output ahead of a producers’ meeting in Doha, Qatar, later in April.

Energy Ministry data Saturday showed that in tons, oil output reached 46.149 million in March versus 43.064 million, or 10.88 million bpd, in February.

Leading oil producers, including Russia, are due to meet in Doha April 17 for talks on how to freeze oil output at the average levels reached in January to support the global market.

But the increase in Russian output to levels not seen since 1987, when it reached a record high of 11.47 million bpd, suggests it may prove difficult for Moscow to stick to oil output freeze commitments.

Russian Energy Minister Alexander Novak said the March production would not be an obstacle to the expected agreement on a production freeze, local news agencies reported.

Some oil industry observers said it would be hard for Russia to stick to an output freeze since the domestic industry is dominated by several big oil companies, such as Rosneft (ROSN.MM), Gazprom (GAZP.MM) and Lukoil (LKOH.MM), each with its own agenda.

The latest production statistics showed that companies, categorized by the ministry as “small producers” were behind the higher production total, with an increase of 1.5 percent to 4.92 million tons (1.16 million bpd) in March.

An 11.9 percent rise in output from joint ventures with foreign oil companies also contributed to the increase in the total production figure. Oil output under these production sharing agreements, designed in the 1990s to encourage investment by foreign oil companies, rose to 1.51 million tons (357,000 barrels per day) last month.

Output from major Russian oil companies fell last month, lead by a 0.7 percent output decline at world’s biggest listed oil producer Rosneft. Output at Lukoil and Surgutneftegaz (SNGS.MM) edged down by 0.1.

Rosneft has said it plans to keep production unchanged this year after it fell by 1 percent in 2015.

The data also showed that Russian pipeline oil exports rose to 4.45 million bpd last month from 4.31 million bpd in February.

Natural gas production was at 53.98 billion cubic meters (bcm) last month, or 1.74 bcm a day, versus 52.92 bcm in February.