Russia pumping oil at record pace – Bloomberg

Oil companies in Russia are operating at a record pace this year despite Moscow’s agreement to extend production cuts with its OPEC+ partners, Bloomberg reported on Monday. 

The nation’s rigs drilled 14,700 kilometers of production wells in the first six months of the year, 6.6% more than planned and 8.6% more than in the same period a year ago, data obtained by the news agency shows. 

Russian oil extractors demonstrated “a post-Soviet production-drilling record” in 2022, Ronald Smith, an oil and gas analyst at Moscow-based BCS Global Markets, told Bloomberg, adding that a new high will be established this year. 

Moscow had previously ordered the country’s oil companies to curb output by 500,000 barrels per day. The measure was initially introduced for just several months to retaliate against Ukraine-related sanctions. It was subsequently extended until the end of 2024 in coordination with OPEC. 

The projected drilling record comes as the Russian oil sector faces unprecedented sanctions imposed by Western countries in 2022 over Moscow’s military operation in Ukraine. Severe restrictions on exports of oil industry equipment and technologies were introduced to curb Russia’s ability to drill and pump crude, an important source of revenue for the national budget. The sanctions have also banned seaborne exports and imposed price caps on Russian crude and petroleum products to the US, EU, UK, and their allies.

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