MOSCOW, Jan. 3 (UPI) -- Government data show Russia, a main component of a managed decline from world producers, turned out 2.5 percent more oil year-on-year.
Effective Monday, members of the Organization of Petroleum Exporting Countries are obliged to cut production by a collective 1.2 million barrels per day in an effort to correct a market that favors the supply side. The deal depends on non-OPEC members to sideline 558,000 bpd of their own output and much of that is expected to come from Russia.
Government data show Russian crude oil production increased 2.5 percent from 2015. Oil production in December was 347.4 million barrels, up 3.5 percent from December 2015.
According to statistics, Russian oil producer Lukoil, one of the country's largest in terms of net reserves, posted a 2.8 percent decline in production. State-owned oil producer Bashneft reported a 6.3 percent gain from 2015.
According to OPEC economists, Russian oil production is expected to average 11.1 million bpd in 2017, up about 500,000 bpd from last year.
In mid-December, representatives from 12 oil companies in the country agreed to work together to monitor compliance with the OPEC arrangement. Economists with French financial services company Societe Generale said, however, that Russia has a poor track record when it comes to managed declines.
Last month, Russian Energy Minister said balance between supply and demand would return to the market at some point near the end of the year. OPEC's agreement pulled oil price well above the $50 mark and the minister said $60 per barrel was likely, though anything beyond that was uncertain.
Russian President Vladimir Putin said the budget for 2017 is based on oil priced at around $40 per barrel.