Russian Oil Exports Set For A Record 2016

A flag with the logo of Rosneft, Russia's largest oil company, flutters over the Novokuibyshevsk refinery near the city of Samara, Russia. © Nikolay Korchekov / Reuters

Russia has increased crude exports by almost five percent to 5.55 million barrels a day in the first half of the year compared to 2015. Analysts say exports may reach a record high this year.

RT News report continues:

The Russian Energy Ministry says output last month grew by 1.14 percent from a year earlier to 10,843 million barrels a day, with increases every month since July 2014. The ministry is predicting a 4.5-4.9 percent growth this year.

“If production remains steady, then it will likely be a record year for exports,” said Christopher Haines, head of oil and gas at BMI Research, as cited by Bloomberg. “This should mean competition is strong, especially with Iran sending more oil into southern Europe.”

In April, Russian crude exports jumped nine percent to their highest level in sixteen months. Overall, the country exported 20.3 million tons of crude that month.

Crude exports from Russia continue to grow; the country became the world's leading oil and natural gas exporter last year, according to BP's annual statistical review of world energy. It has overtaken Saudi Arabia in crude exports, and retained the top spot in exports of natural gas.

In 2015, Russia’s oil production reached a new post-Soviet high of 11 million barrels per day, with three-quarters of it going for export.

Low oil prices and a higher tax burden have made it more profitable for Russian companies to export oil rather than deliver it to local refineries. Increased oil production was another reason for the surge in exports.

In 2016, Gazprom Neft is expecting to produce more from the northernmost onshore oilfields in Russia – the Messoyakha fields – which could be as much as 470 million tons of oil and gas condensate.

Lukoil has started development drilling at the Filanovsky oilfield in the Caspian Sea. In the next 30 years, the company intends to invest at least US$14 billion in the field that has recoverable oil reserves at 151.3 million tons and 26 billion cubic meters of natural gas.

Russia Tops Saudi Arabia As The World’s Largest Oil Exporter

A worker looks at a pump jack in Ufa, Bashkortostan, Russia © Sergey Karpukhin / Reuters 

RT News reports that Russia became the world's leading oil and natural gas exporter last year, according to BP's annual statistical review of world energy. The country has overtaken Saudi Arabia in crude exports, and retained the top spot in exports of natural gas.

Three-quarters of Russia's oil production went for export in 2015. Exports of Russian gas reached 33.7 percent of overall production. The country also exported 41.8 percent of its coal.

According to the report, crude exports from the Middle East rose by 670,000 barrels per day last year as Iraqi and Saudi production hit record levels. Over 75 percent of Middle Eastern oil exports went to the Asia Pacific region, although Europe increased its oil imports from the region by 590,000 barrels per day.

"Russia is the leading oil and gas supplier to Europe, accounting for 37 percent and 35 percent of European respective consumption,” said the report.

Russia’s oil production increased for the seventh consecutive year growing 1.2 percent in 2015 and reaching a new post-Soviet high of 11 million barrels per day.

Energy production grew by 0.7 percent and the country accounted for 10 percent of the global primary energy output.

Energy consumption in Russia fell by 3.3 percent last year, yet it remained the fourth-largest energy consumer, behind China, the US and India.

Gas remained Russia’s leading fuel, with 52.8 percent of primary energy consumption, followed by oil (21.4 percent) and coal (13.3 percent).

According to Russian Federal Statistics Service Rosstat, the country's oil production in March outpaced Saudi Arabia. Russian producers extracted almost 10.92 million barrels a day compared to 10.12 produced by Saudi Arabia.

Russia sold oil worth more than $10 billion through March this year, according to the data. Crude sales made up 23 percent of Russian exports compared to 25.2 percent in the same period of 2015.

The share of oil in the global economy will go down from 32 to 26 percent by 2040, while the share of gas as a more environmentally friendly energy source is expected to increase, according to Russian Energy Minister Aleksandr Novak.