According to the International Energy Agency, in May 2020 the volume of Russian oil exports through the Druzhba pipeline to Europe will be reduced by 20%.

According to preliminary schedules, the volume of marine exports is expected to decline by 800 thousand barrels per day, as well as a decrease in supplies through the Druzhba pipeline to 675 thousand barrels per day, which is 20% less than the previous month.

In addition, the drop in oil pipeline shipments in April is estimated at 15%. The reason for that was the decrease in demand caused by the crisis against the background of the current epidemiological situation.

The report notes that the production of oil and condensate by Russian companies was reduced to 9.45 million barrels per day, which brings the industry closer to the OPEC target of 8.5 million barrels per day excluding condensate production.

We remind that on April 12 this year 23 OPEC+ countries reached an agreement to reduce oil production. It will operate from May 1, 2020 to May 1, 2022.

The OPEC+ deal is a natural and necessary step by the oil-producing states to stabilize the market caused by pressure from the United States. Nevertheless, the deal is not capable of overriding the decline in global demand, as the reserves accumulated to date are huge.

According to Alexander Novak, head of the Russian Ministry of Energy, if necessary, the deal participants may take additional measures to stabilize the market.

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Author: Daria Vankova