"Advising" OPEC+ not to cut supply further, Russian oil company plans for when to increase production

According to Reuters, speaking to the press on January 27, Mr. Alexander Dyukov, CEO of Gazprom Neft (one of Russia's leading oil and gas companies), said that the Organization of the Petroleum Exporting Countries (OPEC) and its allies, also known as OPEC+, do not need to further cut oil supply.

Alexander Dyukov, người đứng đầu nhà sản xuất dầu Gazprom Neft của Nga, tham dự một phiên họp của Diễn đàn Kinh tế Quốc tế St. Petersburg (SPIEF) tại Saint Petersburg, Nga ngày 16 tháng 6 năm 2022. REUTERS

Mr. Alexander Dyukov, head of Russian oil company Gazprom Neft. (Source: Reuters)

The remarks came days before OPEC+ is scheduled to meet on output policy.

OPEC + agreed to voluntarily cut production by a total of 2.2 million barrels per day in the first quarter of 2024, with Saudi Arabia leading the way with a voluntary reduction of 1 million barrels per day.

The OPEC+ ministerial meeting is scheduled for February 1, and sources say the group is likely to decide on oil production levels for April 2024 (and beyond) in the coming weeks.

According to Mr. Alexander Dyukov, OPEC+ has decided to cut supply from January 2024.

Meanwhile, spring is approaching, when oil demand is expected to increase. According to him, there is no need to adjust the OPEC+ agreement at present.

Gazprom plans to increase refining volumes and hydrocarbon output in 2024, Mr. Dyukov added, but did not provide specifics, while Gazprom Neft's investments are believed to remain unchanged this year.

The International Energy Agency (IEA) said the market appeared to remain well supplied in 2024 despite conflict in the Middle East raising concerns about supply and a possible glut if OPEC+ lifted production cuts as planned in the second quarter of 2024.

In related news, Russian Energy Minister Nikolai Shulginov said the country's oil production is likely to remain largely unchanged this year.

Russia's oil and condensate output will fall slightly in 2023 to 530 million tonnes (10.6 million barrels per day), RIA news agency reported.

Interfax news agency also quoted Shulginov as saying that Russia had cut gasoline exports following the incident at the NORSI refinery.

The outage has raised concerns about a possible nationwide gasoline shortage, and there are media reports that the government is considering imposing a ban on fuel exports, as it did last fall.

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