Bloomberg: Russia oil output hits 18-month low amid sanctions pressure

Russia’s crude oil output dropped sharply in December, marking its steepest decline in a year and a half as Western sanctions squeezed exports and Ukrainian drone strikes disrupted key energy facilities, leaving growing volumes of oil stranded at sea.

The country produced an average of 9.326 million barrels per day last month, according to people familiar with confidential government data who spoke on condition of anonymity, Bloomberg reports.

That level, which excludes condensate production, was more than 100,000 barrels per day lower than in November and nearly 250,000 barrels per day below the cap Russia is permitted under its agreement with the Organisation of the Petroleum Exporting Countries and its partners.

The downturn coincided with an escalation in Ukrainian drone attacks targeting Russia’s oil infrastructure, directly reducing production and hampering refinery operations that process crude supplies.

Russia’s Energy Ministry did not immediately comment on the December production figures in response to a request from Bloomberg, as the country was observing a public holiday.

The fall in output was the largest since June 2024, a time when Russia was formally committed to production cuts under the OPEC+ deal.

Prior to December, Russian crude production had been trending upward, though the pace of growth had already begun to slow toward the end of the year.

Russia’s government classified the nation’s oil statistics in 2022 following the war in Ukraine.

According to the latest forecast by investment bank Goldman Sachs, the price of Brent Crude is expected to fall to $54 per barrel by the end of 2026, while WTI crude is projected to decline to $50. Analysts note that the realisation of geopolitical risks in Russia, Venezuela, or Iran could disrupt this outlook.

By Jeyhun Aghazada