Russian oil production cutting drive stalled in February

The country's oil and gas condensate output remained at 11.11 million bpd last month

Russia's oil output stayed unchanged in February from the previous month, with cuts at just a third of the levels pledged by Moscow under a global deal to reduce production, Energy Ministry data showed on Thursday.

The country's oil and gas condensate output remained at 11.11 million barrels per day (bpd) last month, down 100,000 bpd from levels agreed as the starting point for the accord.

OPEC and other large producers led by Russia agreed late last year to reduce their total oil output by almost 1.8 million bpd in the first half of 2017 to boost the price of crude, a key source of revenue.

Of that, Russia pledged to cut 300,000 bpd, with 200,000 bpd of reductions in the first quarter. This compares to output of more than 11.2 million bpd in October last year, taken as the baseline for the global deal.

In January, Russia cut output by around 100,000 bpd month-on-month, its first reduction since August. It kept that magnitude of output curbs in February.

REAL CUTS

Analysts at Moscow-based Sberbank CIB said that due to the gradual nature of reductions, "the average cut over the first half of 2017 from the October 2016 reference month would therefore be just under 200,000 bpd, or 99,000 bpd in annual terms".

Reuters uses a barrels/tonnes ratio of 7.33.

In tonnes, oil output reached 42.434 million in February versus 46.992 million in January. According to Reuters calculations, Russia's cut from the October level reached 100,000 bpd in February, resulting in compliance of just 33 percent.

By contrast, compliance within the Organization of the Petroleum Exporting Countries is 94 percent, due mainly to a steep reduction by Saudi Arabia.

Russian oil pipeline exports in February declined to 4.311 million bpd, from 4.409 million bpd in the first month of the year.

Last month, all three top Russian oil producers, Rosneft, Lukoil and Surgutneftegaz, reduced output.

However, Gazprom Neft, the oil arm of Kremlin energy champion Gazprom, boosted its production by 1.4 percent, while the output of small producers edged up 0.1 percent.

Russian natural gas production was at 58.53 billion cubic metres (bcm) last month, or 2.09 bcm a day, versus 66.11 bcm in January.