Russia’s negotiations with OPEC to limit oil production has brought in the budget more than 400 billion rubles ($6 billion). This is due to the fact that contacts with the cartel contributed to the increase in oil prices, and its production was increased
Russia’s decision to enter into negotiations with OPEC to limit oil production in early 2016 added to the budget of more than 400 billion rubles ($6 billion), Bloomberg said, citing two officials familiar with the calculations of the government.
Russia’s cooperation with OPEC contributed to the increase in oil prices from $27 to 44 per barrel, says Bloomberg. As a result, government revenues increased in the amount from 400 billion to 700 billion rubles., said a spokesman.
Budget revenues from export duties on oil and taxes on oil production in the period from January to October of 2016 amounted to RUB 2.7 trillion, according to Bloomberg, citing data from the Ministry of Finance. According to estimates most agencies, due to increased oil prices since June, the monthly revenues from these taxes exceeds 300 billion rubles., while in February they amounted to 185 billion rubles.
In the negotiations on the freezing of production earned not only Russia, but other oil exporters, including OPEC, said RBC senior analyst of Sberbank CIB Valery Nesterov. If there were no such negotiations, the so much not growing because the world’s steadily increasing oil production, he adds.
By the end of October the daily average oil production in the country exceeded 11.2 million barrels, which was a new absolute record for the post-Soviet Russia.
Talks about the freezing of oil production started in February, after oil prices reached multi-year lows. April 17, OPEC members gathered in the Qatari capital Doha to sign the agreement, but never did it due to disagreements between individual members of a cartel. However, on April 21, Bloomberg reported that only pending the signing of the agreement and the price increase (per month with $33 to 43 per barrel), Russia additionally has earned $3.7 billion.
In September at the talks in Algeria of the OPEC countries for the first time since 2008, agreed to reduce the level of oil production. Countries agreed to reduce the total production of 33.24 million to 32.5–33 million barrels per day. The volume of production for each country cartel plans to install at the next meeting, which will be held on November 30.
Wednesday, November 16, Russian energy Minister Alexander Novak said that Moscow hopes for an agreement between the countries of the OPEC on stabilisation of oil production by November 30. The official stressed that if this does not happen, the balancing market will be delayed, and the imbalance will continue to put pressure on prices.
In October Reuters quoted sources said that the meeting of the heads of the oil ministries of OPEC countries and Russia, which took place on October 23 in Riyadh, it was announced that the leaders of OPEC to cut oil production by 4%. According to the interlocutor of Agency, Russia has already indicated that it does not intend to reduce the extraction of raw materials, but ready to freeze it at current levels and not increase further.