Oil bluff: even if OPEC+ increases quotas, Russia will not be able to increase production

Alexey Gromov, Principal Director on Energy studies at the Institute for Energy and Finance, commented to Forbes on the current situation with oil exports from Russia and the prospects for Russian oil production in 2026.

"The decrease in drilling, which Bloomberg shows, is not a determining factor for production," Alexey Gromov says. — The main thing today is the market. Drilling is responding to market realities and is being adjusted accordingly."

According to his calculations, Russian offshore oil exports in the first three weeks of February increased by about 200,000-250,000 b/d compared to January's 3.1 million b/d due to purchases from China, which "got a taste for Russian discounts." If in 2025 Beijing bought about 1.3 million b/d of Russian oil delivered by sea, Gromov recalls, then in January 2026 it took almost 1.9 million b/d, 600,000 barrels more than in December last year, buying oil that was not sold to India. And in the first three weeks of February, China began to buy another 100,000-150,000 b/d more than in January, exceeding 2 million b/d.

According to the expert, this growth is primarily caused by low prices for Russian Urals crude oil, which is currently selling at about $38-39 per barrel, although this is more than $36 per barrel in January. The second component, Gromov notes, was China's loss of access to cheap Venezuelan oil, which it bought from 600,000 to 700,000 bpd last year, depending on the month. Oil supplies from Iran, which cost China about $20 per barrel more than Russia's, decreased by about 300,000 bpd, Gromov recalls. Thus, he says, Beijing has increased imports of Russian oil by about the amount of reduced imports from Venezuela and Iran.

"I think China's increased purchases of Russian oil will continue throughout February and, most likely, March," Gromov says.

According to the expert, in the future, the volume of Russian oil exports and, as a result, production will depend on India, which has become uncertain after the decision of the US Supreme Court, which abolished the import duties imposed by Trump. Because of this, New Delhi has suspended preparations for concluding a trade agreement with the United States. It was assumed that India would abandon Russian oil in exchange for lower duties on Indian goods.

If the OPEC + countries do decide to increase production, and the situation with Iran is resolved quickly enough, an uncontrolled decline in oil prices is possible, and we will "fly to $ 50 per barrel by the end of the year," the expert argues.

At the same time, if OPEC+ decides to increase production, Russia will not be able to take advantage of the opening opportunities and fill the increased quota due to declining export opportunities.