Novak says Russian crude output to rise in July

Russian crude output will continue to rise in July to close in on levels attained before the war in Ukraine, deputy prime minister Alexander Novak said today.

"We see substantial growth in June as compared to May, of 600,000 b/d," he said on the sidelines of St Petersburg International Economic Forum. "Actually we are very close to restoring the levels of February." But he said Russia's crude exports will slip slightly this month as domestic refining activity rises.

The Russian energy ministry no longer publishes monthly production data, but state-owned news agency Tass — citing a source familiar with official statistics — has said crude and condensate output increased by 4.7pc on the May average to 1.46mn t/d (10.66mn b/d) in the 1-14 June period. Production was 1.51mn t/d (11.03mn b/d) in February.

Oil production dropped by almost 9pc in April as a result of reduced demand on export markets since the invasion of Ukraine in February, but output growth returned — albeit of just 1pc — in May.

Asked about the prospects of extending the Opec+ deal beyond its expiry at the end of this year, Novak said this will become clear towards the end of the year.

"Everything will depend on how the market situation will be developing," he said. "Whether it will require [setting production] quotas or it simply will be the interaction within the Opec+ charter [without any time limits].