OPEC+ crude oil production drops in February despite uptick in Russia: Platts survey

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The OPEC+ coalition's crude oil production fell by 80,000 b/d in February, the latest Platts survey by S&P Global Commodity Insights found, with volumes dropping in Iraq, Angola and Kazakhstan.

The drop came despite a small increase in Russian output of 10,000 b/d to 9.86 million b/d, as the key OPEC ally continued to show resilience to western sanctions targeting its oil sector, though Deputy Prime Minister Alexander Novak has said March volumes are likely to be cut by 500,000 b/d.

Overall, OPEC's 13 members pumped 29.03 million b/d, down 60,000 b/d from January, while the bloc's Russian-led partners added 13.64 million b/d, down 20,000 b/d.

Largest producer Saudi Arabia increased output to 10.46 million b/d, while Nigeria hit its highest volume in a year, at 1.45 million b/d, with higher loadings in the month.

Downward pressure on OPEC production came from Iraq and Angola. Iraqi production fell by 150,000 b/d to 4.33 million b/d. Flows from the port of Ceyhan were suspended for a few days on pipeline repairs as a result of the Feb. 6 earthquake that hit Turkey and Syria. Maintenance at the West Qurna 2 project also reduced output.

Angolan production fell 70,000 b/d on maintenance at the Dalia oil field.

Russian resilience

Russian production grew despite the introduction of an EU embargo on most imports of Russian refined products and accompanying price caps that came into force Feb. 5. This added to similar measures on crude oil imports in place since Dec. 5, as western governments seek to punish Moscow for its invasion of Ukraine.

Output remains below February 2022 levels of 10.11 million b/d but is significantly above its war-time low of 9.14 million b/d in April.

Despite relatively steady production up to now, Russia is expected to see a sharp decline going forward. Novak, Russia's OPEC+ envoy, said in February that it would voluntarily cut 500,000 b/d in March, though many analysts have said this amounts to an admission that the sanctions on refined products are hampering refinery runs and consequently upstream production.

Any escalation in the conflict in Ukraine raises the risk of a steeper drop, either as a result of further sanctions or damage to infrastructure.

Non-OPEC production was also supported by Bahrain, which increased output by 40,000 b/d to 190,000 b/d in February.

Increases from Russia and Bahrain were counterbalanced by a significant dip in output from the second largest non-OPEC producer Kazakhstan. Its output fell by 50,000 b/d to 1.55 million b/d due to weather-related disruptions at the Caspian Pipeline Consortium, and the impact of the earthquake on the Baku-Tbilisi-Ceyhan pipeline.

Underproducing quotas

With several countries still struggling to raise or even maintain output due to internal disruptions or lack of investment, the OPEC+ alliance continues to massively underproduce its quotas, even with the group agreeing to slash them by 2 million b/d from November through the end of 2023.

Overall OPEC+ compliance among countries with quotas was 153% in February, according to S&P Global calculations, meaning the 22 members combined for a 1.91 million b/d shortfall to their production targets.

OPEC members Iran, Libya and Venezuela are exempt from quotas.

An OPEC+ monitoring committee co-chaired by Saudi Arabia and Russia is next due to meet April 3, followed by a full OPEC+ ministerial meeting scheduled for June 3-4.

The Platts survey figures measure wellhead production, and are compiled using information from oil industry officials, traders, and analysts, as well as reviewing proprietary shipping, satellite, and inventory data.

OPEC+ production

Unit: million b/d

Source: Platts OPEC+ survey by S&P Global Commodity Insights

Click here to read the previous survey: OPEC+ January crude oil output grows, with Russia still resilient to sanctions: Platts survey