Russia meets its oil production reduction target within OPEC+ in May

TASS Russian News Agency | May 25, 2020 at 3:54 PM

MOSCOW, May 25. /TASS/. Russia has met its target of reducing oil production under the OPEC + agreement, cutting the output by 2 mln bpd, a source familiar with the report of Energy Minister Alexander Novak at a meeting of the State Council, told TASS.

"The OPEC+ deal began to work, and Russia has reached the target figure, we agreed on, which is 2 million barrels of reduction per day," the source said.

According to Novak, the whole deal allowed to remove 14-15 mln barrels per day from the market. The Energy Ministry hopes that already in June-July it will be possible to reach the zero balance in the oil market. He noted that demand is recovering as the restrictions in the world are being removed.

"The OPEC+ deal allowed us to reduce production evenly across all countries in a regulated way, if there hadn't been a deal, demand decline would not go away, a chaotic decline in demand would affect Russia," the minister said.

The demand for fuel is also recovering.

"If we talk about air transportation and gas stations, the demand for gas stations fell by 50-70%, now the fall is about 20-40%," he said. The decline in demand for jet fuel has now slowed to 30-40% compared to 40-50% in April.

The demand for fuel is also recovering in the domestic market.

"Gas prices have not changed since the beginning of the year, diesel prices have grown by 1.5%, which is below the inflation rate," the source said.