Russia to maintain high oil output – JPMorgan

Russian oil drillers can maintain high production despite numerous rounds of Western sanctions, JPMorgan projected this week, according to Reuters. 

The Wall Street bank pointed to growing demand for crude oil from China and India which is expected to increase collectively by 1 million barrels per day (mbd) this year.

“We believe Russia will be able to maintain its oil production at pre-war levels of 10.8 mbd but will have difficulties getting back to peak pre-Covid volumes of 11.3 mbd,” JPMorgan reportedly stated.

The US bank suggested that Moscow could struggle to reroute part of its oil product exports away from the EU, following the bloc’s embargo on imports of Russian fuels. Seaborne oil product shipments from Russia are set to decline by around 300,000 barrels per day to “lows last seen in May 2022,” it projected.

Meanwhile, business daily Kommersant reported this week, citing industry sources, that Russian oil output in February reached pre-sanctions levels for the first time, and may exceed the February 2022 figure.

According to Kpler, Russian crude oil and petroleum product exports also held strong last month, with energy producers managing to ship 7.32 million barrels per day of crude oil and oil products.

While the EU and G7 nations have introduced price caps and restrictions on Russian fuel imports, China, India, Türkiye, and some other countries have boosted purchases from Moscow. Last month, Russia unveiled plans to curb oil production in March by 500,000 barrels a day, or about 5%, in retaliation to Western sanctions.

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