Russian Oil Output Up 1.4% to Post-Soviet Record as Exports Drop

Russian production of crude oil and natural-gas condensate topped June’s post-Soviet record last month as companies like OAO Gazprom, spurred on by President Vladimir Putin, invested in increasing output.

Production rose 1.4 percent to 10.52 million barrels a day, from a year before, according to preliminary data from the Energy Ministry’s CDU-TEK statistics unit. Exports fell for a fourth month, by 8.1 percent to 4.9 million barrels, it said.

Brent oil prices have more than doubled since 2008. They fell 0.31 percent to $113.66 a barrel by 12:08 p.m. in Moscow.

“We’re still at very comfortable oil price levels,” Alexander Nazarov, an analyst at OAO Gazprombank, said today by e-mail. That spurs companies to support output at old fields and deliver more from new ones, he said. “Russia is refining more. That’s the main and straightforward reason why we export less.”

The country started up the Taneco refinery 18 months ago and has since expanded others including Khabarovsk, he said.

Putin has pledged to keep oil output, the largest single source of tax income, stable for decades. Oil and condensate output at Gazprom, the state gas-export monopoly, expanded 20 percent from a month before to 321,000 barrels a day, faster than other Russian producers, according to the company’s data.

Russian natural gas production rose 6.7 percent to 1.54 billion cubic meters a day, the ministry figures show. Gazprom increased output to 1.05 billion cubic meters a day and Novatek boosted production to 127 million cubic meters a day.

Russia’s Soviet-era crude and condensate production peaked at 11.48 million barrels a day in 1987, according to BP Plc (BP/) data. Output increased to 10.5 million barrels a day in June.

To contact the reporter on this story: Stephen Bierman in Moscow at sbierman1@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

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