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Russia is on pace for record oil drilling for the 2nd year in a row despite the West’s sanctions

January 11th, 2024

Russia is on pace for its second year in a row of record oil drilling.AP

  • Russia is on pace for its second-consecutive year of record oil drilling in 2023.

  • For the first 11 months of last year, Russia drilled 28,100 kilometers and should surpass 30,000 kilometers for the full year.

  • That should top 2022’s post-Soviet record for total drilling depth, according to Bloomberg.

Russia is on pace to notch its second consecutive year of record oil drilling, even as Western nations maintain sanctions on the warring nation.

Through the first 11 months of last year, Russia drilled a total depth of 28,100 kilometers and should surpass 30,000 kilometers for the full year, according to Bloomberg, which cited figures from Kpler and Yakov & Partners.

That should top 2022’s post-Soviet record for drilling, the report said. What’s more, Russia’s exploration drilling rates have also grown to levels not seen since early in the pandemic.

Since President Vladimir Putin ordered the invasion of Ukraine in February 2022, his country has leaned heavily on its energy sector to try and sustain its economy, war efforts, and standing on the world stage.

That’s despite key oil-service providers withdrawing from the country. And while sanctions like crude oil import bans and price caps have been obstacles for Russian producers, drilling activity appears to be humming along.

Even so, record drilling numbers don’t necessarily translate to booming production. Russian firms are working to maintain oil output from their oldest wells, while newer projects face smaller markets and fewer viable trade partners.

Meanwhile, Russia’s record highs in drilling came as Moscow agreed to curb production in line with its OPEC+ partners, suggesting more activity may be needed just to prevent output from declining further.

In December, Russia’s daily crude production averaged about 9.57 million barrels a day, nearly 60,000 barrels a day lower than the prior month.

Read the original article on Business Insider

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