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Record number of oil wells in Russian Siberia. Where does all this black gold go?

Russia's main oil-producing region, Khanty-Mansiisk (Yugra), in western Siberia, significantly increased oil well drilling in March, Reuters reported. The region – which accounts for 40% of Russian oil production – started 402 new wells last month, up 34% from February and higher than the monthly average of 365 new wells drilled in 2022. Last year, the region was responsible for 223 million tons of oil and gas condensate (4.5 MMbbl/d) out of Russia's 535 million tons total.
Fears are growing that Russian oil production may not have declined despite government announcements. According to some reports, Russian crude shipments remain strong despite sanctions and embargoes: Reuters reported that April oil shipments from Russia's western ports are on track to hit their highest since 2019, at more than 2.4 million bbl per day. Earlier, Russian Deputy Prime Minister Alexander Novak announced that Russia would cut production by 500,000 bpd in March and promised in early April to extend the cuts until the end of the year. This is a very curious situation: on the one hand, Russia officially drops its production, on the other we have a record number of wells in the region with the richest production. Is it not that the actual export does not correspond to the official one and some oil comes out of the official channels?

In December, Russian President Vladimir Putin inaugurated the Kovykta natural gas field in eastern Siberia, which is strategically located to allow Russia to increase gas exports to China amid rising tensions between Moscow and Russia. 'West. The opening was the culmination of efforts that began nearly a decade ago to develop new fields and build the Power of Siberia pipeline to supply gas to the rapidly expanding market.

“We are launching the unique Kovykta gas field, the largest in Eastern Siberia. Its recoverable reserves are 1.8 trillion cubic meters of gas,” Putin said via video link during a televised ceremony.

The first Power of Siberia gas pipeline started delivering gas from Eastern Siberia to China in late 2019. It won't be the last. Moscow has planned the construction of a Power of Siberia 2 gas pipeline, while Russia is increasingly turning to the Middle Kingdom in the face of heavy Western sanctions. China and India have become major buyers of Russian oil and gas, and Julian Lee, oil strategist at Bloomberg, revealed that late last week Ural crude, Russia's flagship, traded at a huge discount of over $30 a barrel, or around 40% off international Brent crude.

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The article Record in the number of oil wells in Russian Siberia. Where does all this black gold go? comes from Economic Scenarios .

This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/record-nel-numero-di-pozzi-di-petrolio-nella-siberia-russa-dove-finisce-tutto-questo-oro-nero/ on Tue, 25 Apr 2023 15:47:39 +0000.