17 Jan 2019 19:14

Russia attempting to reduce oil production more quickly to OPEC+ agreement levels, but there are technical restrictions

BELGRADE. Jan 17 (Interfax) - Russian is doing its utmost to reduce oil production to levels agreed upon under the OPEC+ agreement, but there are some technical restrictions, that make it difficult,' Russian Energy Minister Alexander Novak told reporters on Thursday.

Russia is reducing production "more slowly than I would like," Saudi Energy Minister Khalid Al-Falih said earlier.

At the summit of OPEC and non-OPEC countries in December, Russia's request for a gradual reduction in oil production was heard and garnered support, Novak recalled.

"When we discussed this matter in December prior to the signing of the agreement, we initially said that reaching these indicators would take some time. And we said that we have specific conditions, that we have low temperatures in the winter season, that we have distinct climatic and geological features of production. Thus, we cannot in principle sharply reduce production. This was the case in 2017, when there was a reduction, it unfolded gradually, slowly. Last time, we reached those indicators over three-four months," he said.

"Certainly, we will try to make the reduction quicker, but once again, we have technological restrictions, and we will reach the indicators which we agreed upon. Our companies support the agreement that were reached, and Russia is committed to those agreements," Novak said.

"Russia, in principle, cannot sharply reduce oil production, but we will do our best to do this promptly," he said.

According to agreements between the OPEC and non-OPEC states, Russia must gradually reduce production by 228,000 barrels per day in H1 2019 relative to October 2018. A reduction of 50,000 bpd should take place in January.