Picture: ISTOCK
Picture: ISTOCK

Moscow — Russia’s crude oil production climbed to a record in 2017 even as it joined forces with the Organisation of the Petroleum Exporting Countries (Opec) to clear a global glut and lift prices.

Russian oil output increased to an average 10.98-million barrels a day in 2017, up 0.1% from the previous year and the highest since the collapse of the Soviet Union in 1991, according to data published on Tuesday by the Energy Ministry’s CDU-TEK statistics unit.

The Kremlin’s deal with Opec has been extended until the end of 2018, a sign that allies are committed to cutting stockpiles to boost prices. The pact has helped to deliver an unprecedented period of cooperation that is reshaping the global oil market and energy geopolitics.

Russia’s agreement

The Kremlin achieved a record despite the cut because it ramped up production to 11.23-million barrels a day in October 2016, a month before the accord was announced. Russia agreed to cut production by 300,000 barrels a day from its annual peak that month.

Even as Russia’s manoeuvres enabled it to produce more than ever, its allies in Opec are not complaining. Brent prices climbed 18% in 2017 and global inventories have fallen. Following the November decision to extend the pact through 2018, Saudi Arabia’s energy minister Khalid Al-Falih, sitting next to his Russian counterpart Alexander Novak at a media conference, said, "we are completely aligned".

Brent rose 0.6% to $67.29 a barrel on the London-based ICE Futures Europe exchange at 7.16am local time.

Oil output in December was 10.95-million barrels a day, up 0.1% from November, while exports dropped 5.3% to 5.24-million barrels a day, according to CDU-TEK.

Bloomberg

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