Russia may raise oil output, exports after failure of Doha talks

By Jake Rudnitsky, Dina Khrennikova on 4/19/2016

MOSCOW (Bloomberg) -- Just two days after the collapse of international oil-supply talks in Doha, Russia signaled it isn’t afraid to play a game of chicken.

Freed from a plan to coordinate output with OPEC members, Russian officials said Tuesday that the country may boost both production and exports. Output could grow by 100,000 bopd to 10.81 MMbopd in 2016, according to Deputy Energy Minister Kirill Molodtsov.

“And why not?” he said at the National Oil and Gas Forum in Moscow. “It’s possible.”

A proposal between major producers to cap oil output unraveled at talks on Sunday after Saudi Arabia said an agreement wasn’t possible without the participation of Iran. A freeze deal would have marked the first collaboration between the Organization of the Petroleum Exporting Countries and Russia in 15 years as a global glut keeps oil prices 60% below their 2014 high.

Russian crude exports to countries outside the Commonwealth of Independent States could grow as much as 4.3% to 255 million metric tons this year, or 5.11 MMbpd, First Deputy Energy Minister Alexey Teksler said at the forum. That would mean an extra 300,000 bopd flooding international markets amid speculation that Middle East producers may also boost supply to keep market share.

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