Russia to Cut Oil Output to 8.979 Million bpd in June 2024 Under OPEC+ Obligations
In June 2024 Russia must cut its oil output to 8.979 million barrels per day (bpd) as part of its obligations under the OPEC+ deal — a level equal to the production quota of Saudi Arabia within the group, according to Interfax calculations based on Energy Ministry data and OPEC readings.
The June target: 8.979 million bpd
MOSCOW, June 3, 2024 — Russia's official OPEC+ production quota for 2024 stands at 9.95 million bpd. Counting the voluntary cuts announced in April 2023, the effective ceiling is 9.45 million bpd. Within that framework the implied monthly production target for June 2024 is 8.979 million bpd, the lowest level of the second quarter and the same figure as the Saudi quota.
The June level completes a sequence of declining monthly targets: the implied ceiling fell from 9.1 million bpd in April to 9.05 million bpd in May and then to 8.979 million bpd in June. The step-down reflects how Russia's second-quarter pledge is structured between production cuts and export cuts.
The Q2 pledge: 471,000 bpd split by month
Under the OPEC+ agreement Russia pledged cuts to production and exports totalling 471,000 bpd in the second quarter of 2024. The pledge is distributed unevenly across the three months, with the export component disappearing by June:
- April 2024 — a cut of 350,000 bpd to production plus 121,000 bpd to exports, implying a production target of 9.1 million bpd;
- May 2024 — a cut of 400,000 bpd to production plus 71,000 bpd to exports, implying a production target of 9.05 million bpd;
- June 2024 — a cut of 471,000 bpd to production only, implying the 8.979 million bpd target.
The shift from a mixed production-and-export cut in April and May to a production-only cut in June explains why the June target sits below the April and May levels: the entire pledged volume is taken out of production rather than partly out of exports.
April overproduction and the compensation arithmetic
OPEC's readings put Russian oil output in April 2024 at 9.292 million bpd. Against that figure, Interfax calculated that Russia produced 192,000 bpd above its permitted level in April, having produced 105,000 bpd below the permitted level over the first quarter of 2024. Netting the two deviations gives the compensation volume Russia needs to deliver:
- Q1 2024 — output 105,000 bpd below the permitted level;
- April 2024 — output 192,000 bpd above the target, on the OPEC reading of 9.292 million bpd;
- compensation required — about 87,000 bpd.
The Energy Ministry said Russia is "fully committed to the OPEC+ agreements" and would submit a compensation plan to the OPEC secretariat, Interfax reported on June 3, 2024.
Follow-through: the October 2024 OPEC+ target
The compensation track continued into the autumn. In October 2024 the combined OPEC+ target — quotas plus voluntary cuts plus compensation adjustments — stood at 35.24 million bpd, down 247,000 bpd from September, according to Interfax's October coverage. Russia's compensation added an extra cut of 10,000 bpd to its October obligation.
Key parameters at a glance
- official 2024 quota: 9.95 million bpd, or 9.45 million bpd counting the voluntary cuts announced in April 2023;
- June 2024 target: 8.979 million bpd, equal to the Saudi Arabia quota within OPEC+;
- Q2 2024 pledge: 471,000 bpd of cuts to production and exports, split by month;
- April deviation: 192,000 bpd above target against a Q1 deviation of 105,000 bpd below;
- compensation: about 87,000 bpd, with a further 10,000 bpd in the October 2024 target.
Taken together, the June target of 8.979 million bpd and the compensation plan describe a single compliance path: Russia first under-produced against its quota in the first quarter, over-produced in April, and then accepted the deepest monthly cut of the second quarter in June, with the residual imbalance to be compensated under the OPEC+ monitoring procedure.
Leave a comment