Russia to make deeper oil export cuts in December, Russian deputy PM Novak says

Russia said on Sunday it would deepen oil export cuts in December by potentially 50,000 barrels per day or more, earlier than promised, as the world’s biggest exporters try to support the global oil price.

Saudi Arabia and Russia, the world’s two biggest oil exporters, called in December for all OPEC+ members to join an agreement on output cuts after a meeting of the producers’ club.

Russian President Vladimir Putin visited Riyadh shortly after the meeting of OPEC+, which brings together the Organization of the Petroleum Exporting Countries (OPEC), Russia, and other allies.

Russian Deputy Prime Minister Alexander Novak, Putin’s top oil and gas point man, was quoted by Russia’s three main news agencies as saying that Russia would deepen cuts beyond the 300,000 barrels per day of cuts already agreed for this year.

“Already in December we will add additional volumes,” Novak was quoted as saying by Interfax news agency. “By how much, we’ll see based on the results of December — there may be an additional 50,000 bpd, maybe more.”

Russia had pledged to a cut of 300,000 bpd compared to the May-June exports — and to keep at that level until the end of
the year.

In December, Russia agreed to deepen those cuts to 500,000 bpd in the first quarter of 2024, the Russian agencies said.

Due to promises made to OPEC+, Russia’s oil exports in 2023 will total less than the 247 million tonnes used in Russia’s main macro-economic forecasts, Novak said.

Novak said he hoped that Gazprom and Chinese producer CNPC could soon agree on the contract conditions for gas sales through the Power of Siberia-2 pipeline.

Russia has been in talks for years about building the Power of Siberia-2 which will carry about 50 billion cubic meters of gas a year from Yamal in northern Russia to China via Mongolia.

“We expect that the company should reach an agreement as soon as possible,” Novak said.