World Oil Supply
OPEC Monthly Oil Market Report – October 2017
Preliminary Russian liquids output in September
remained unchanged m-o-m at 10.935 mb/d
according to the Ministry of Energy, due to peak
maintenance. Total liquids output including NGLs in
3Q17 was reported lower than 2Q17 at 10.95 mb/d.
Moreover, Russia’s liquids output in 2Q17 indicates
an average of 10.99 mb/d which represents a drop
of 0.26 mb/d over 1Q17, owing to some major
Russian oil companies having adjusted output by
roughly 3% in line with the Declaration of
Cooperation with OPEC and other key producing
countries. As a result, Russian oil output data
indicates that conformity of more than 300 tb/d has
already been achieved by the Russian Federation.
The comparison between OPEC, IEA and EIA is
Graph 5 - 24.
According to the latest assessment, Russian oil
production in 2017 is expected to decline by
0.04 mb/d for this year to average 11.04 mb/d,
Graph 5 - 24
: Comparison of Russia’s quarterly
liquids output by different sources
revised down by 75 tb/d from the previous month’s forecast. At the same time, the oil supply forecast for
2018 was revised down by 73 tb/d, representing a decline of 0.01 mb/d y-o-y to average 11.03 mb/d.
Regarding to Russian upstream project start-ups, three new upstream projects are expected to start-up in
4Q17, most probably in October. These are Kondinskoye, which has a peak capacity of 55 tb/d, and
Kosukhinskoye, where peak production will be 33 tb/d. Both will be implemented by Rosneft along with a
third, Odoptu stage 2 (phase 1) by ExxonMobil, with peak production at 29 tb/d. Total production capacity of
179 tb/d is also planned to be added in 1Q18 from Russian companies. This will come from Tambeyskoye
Yuzhnoye by Novatek and two others, namely, the Yaregskoye expansion and phase 2 of Vladimir
Filanovsky by Lukoil by the end of February 2018. All these six projects will peak beyond 2020.
, according to data provided by the Ministry of Energy, oil production declined by 0.07 mb/d
m-o-m, averaging 0.75 mb/d in August, lower by 0.10 mb/d, y-o-y. Of this, 0.68 mb/d was crude and
0.07 mb/d NGLs. The decline was likely caused by the ACG complex, which accounts for three quarters of
Azerbaijan’s output. ACG output averaged 0.59 mb/d during 1H17, compared with 0.66 mb/d a year earlier.
Output from Azerbaijan averaged 797 tb/d in the last eight months of 2017, 40 tb/d lower than last October.
It is expected that supply for 2017 and 2018 will decline by 0.06 mb/d and 0.05 mb/d y-o-y to average
0.79 mb/d and 0.74 mb/d, respectively.
Kazakhstan’s crude production
declined by 78 tb/d m-o-m to average 1.4 mb/d in August. NGLs output
remained steady at 0.27 mb/d in August, indicating a total liquids supply of around 1.67 mb/d. This
represents a decline by 0.07 mb/d m-o-m. Continuous gains from the Kashagan field, which reached
0.2 mb/d in July according to statements from the operator Eni, and a rebound in volumes from the
Karachaganak condensate field offset the production decline at Tengiz, Kazakhstan’s largest oil field, which
was reported to see lower output in August, and declines from other fields because of maintenance over the
month. Oil production forecasts in 2017 and 2018 indicate growth of 0.18 mb/d for this year, all coming from
Kashagan phase one development, and 0.06 mb/d for the next year. However, production next year is likely
to be more uncertain, as peak output in Kashagan might come sooner than expected in 2019.
Sources: EIA, IEA and OPEC Secretariat.