Russia Oil Production Tops 11 Million bpd in June

Russia’s oil production increased to 11.1 million barrels per day  in the first week of June, far exceeding production limits outlined in a global oil deal, Interfax news agency cited a source as saying on Saturday.

Russia agreed to cut its production by 300,000 bpd from 11.24 million bpd as part of a global pact, Oil Price reported.

The Russian Energy Ministry did not immediately respond to a request for comment.

Interfax said Russian oil production stood on average at 1.51 million tons per day in the first week of the month and never dipped below 1.51 million tons.

The Organization of Petroleum Exporting Countries and other leading oil producers, including Russia, will meet in Vienna on June 22-23 to discuss the future of the deal, which is valid until the end of the year.

Russian President Vladimir Putin has said a price of $60 suits the country whose oil output was stagnant at 10.97 million barrels per day for a third month in a row in May.

Oil prices fell on Monday, pulled down by rising Russian production and US drilling activity creeping to its highest in more than three years.

However, many analysts were looking less at markets and more at politics as US President Donald Trump and North Korean leader Kim Jong Un have both arrived in Singapore for a summit on Tuesday, which may lay the groundwork for ending a nuclear standoff between the old foes.

Back in oil markets, analysts expect surging US output to start offsetting efforts led by the OPEC to withhold production, which have been in place since early 2017 and have pushed up prices significantly in the first half of this year.

Brent crude futures were at $76.18 per barrel, down 28 cents, or 0.4%, from their last close.

US West Texas Intermediate crude futures were down 18 cents, or 0.3%, at $65.56 a barrel.

Prices were weighed down by another rise in the number of rigs drilling for new oil production in the United States. The rig count inched up by one to its highest since March, 2015 at 862, according to energy services firm Baker Hughes on Friday.

That implies US crude output, already at a record high of 10.8 million barrels per day, will climb further.

“Non-OPEC supply is expected to rise sharply in 2019 led by US shale growth, along with Russia, Brazil, Canada and Kazakhstan,” US bank JPMorgan said in its quarterly outlook published on Friday, adding that it was bearish on the oil price outlook going into the second-half of the year.