Russia has become the world’s second-largest oil producer, beating Saudi Arabia after producing more crude oil in June, data from the Joint Organisations Data Initiative (JODI) has shown.
The country is only behind the world’s number one producer, the United States, according to the data.
Despite output cuts from the Organisation of the Petroleum Exporting Countries (OPEC) and its allies, OPEC+ the country’s crude oil production stood at 8.788 million barrels per day, according to the data released by the JODI database, which collects self-reported figures from 114 countries.
By comparison, Saudi Arabia’s production in the same month was closer to 7.5 million barrels per day. The overtaking came as Saudi Arabia alongside other Gulf states voluntarily slashed its oil production by an additional 1 million barrels per day for just one month.
This came alongside the 2.5 million barrels per day it was supposed to cut as per the OPEC+ deal which started since May 2020, which involves all 23-member states reducing output by 9.7 million barrels daily.
While Russia and Saudi Arabia are cutting production as part of the OPEC+ agreement, the United States remained the top crude oil producer in the world in June, despite the slump in crude oil production since May in response to the low oil prices.
The JODI database showed that US crude oil production averaged 10.879 million barrels per day in June, up from 10 million barrels per day in May, which saw the lowest US monthly production since late 2017.
In 2018, the US became the world’s biggest crude oil producer after surpassing both Saudi Arabia and Russia.
Due to the oil price collapse in March, both Saudi Arabia and Russia had to seat together to forge a new OPEC+ pact and cut much more oil outputs than in their previous agreement, while US producers reduced nearly 2 million barrels per day of production in response to the low oil prices.
The latest Energy Information Administration (EIA) estimates point to US crude oil production dropping by an average of 990,000 barrels per day this year, for an average of 11.26 million barrels per day. Despite the fact that the estimate is a far greater loss than the EIA had expected in the previous month’s forecast, the US will continue to be the world’s top crude oil producer, ahead of Saudi Arabia and Russia.
On the demand front, the International Energy Agency (IEA) recently said it now sees global oil demand for 2020 at 91.1 million barrels per day, reflecting a fall of 8.1 million barrels per day year-on-year. This revised forecast is 140,000 barrels per day lower than the IEA’s previous projection.
The price of OPEC basket of 13 crudes fell to $44.92 per barrel on Friday, August 21, compared with $45.05 the previous day, according to OPEC Secretariat calculations released today.
The OPEC Reference Basket of Crudes is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Djeno (Congo), Zafiro (Equatorial Guinea), Rabi Light (Gabon), Iran Heavy (Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela).
