Military Review

The third plus OPEC. Why does Russia need gas condensate?

21
The third plus OPEC. Why does Russia need gas condensate?

Courier from Vienna



In anticipation of a large-scale hydrocarbon surplus, which is predicted by almost all experts for the 2020 year, the Organization of Petroleum Exporting Countries decided to work ahead of schedule. Two existing agreements on reduction of oil production quotas may be supplemented by a third. Preliminary agreements on this were reached during the December 5-6 meeting in Vienna of the OPEC monitoring committee.

In recent years, a consortium of oil producers, largely due to personal contacts, has experienced a cross between the “blue” and “pink” periods in relations with Russia. Our country, for which the reduction of quotas is, first of all, the most difficult technological task, makes all kinds of concessions, which in other conditions could become a powerful incentive for the development of oil refining within the country.

However, until now, as you know, they did not. Moreover, due to a decrease in business activity and a series of warm winters in Russia, fuel consumption has been growing very slightly for several years. And this further complicates the problem of fulfilling the quota obligations adopted under agreements with OPEC.

In addition, the need to maintain at least minimum production levels in many low-profit wells, which otherwise would simply have to be closed, also plays a negative role. Re-launching them will be justified only in the case of prohibitively high oil prices.

However, the fact that money earned from oil can be directed to "bad" wells, as well as to deep oil refining and exploration, has been said for a very long time. However, even before the discussion in the State Duma, the matter has not yet reached. NWF funds go anywhere, from dollars and euros to loans to foreign countries, but not to increase the efficiency of the most profitable of all sectors of the economy.

Ministers said but not yet


Before entering into another agreement with OPEC, the Russian energy sector made a very important concession from this consortium. More precisely, we are talking only about the equality of oil producers, which are carefully monitored production levels.

Russia has long sought to ensure that the entire volume of gas condensate is not calculated within the framework of its quota. This is customary for the member countries of the consortium, and Russian experts presented the OPEC + monitoring committee with the appropriate methodology. According to the Minister of Energy of the Russian Federation Alexander Novak, the exporting countries from among the members of this committee agreed with this proposal.


Minister of Energy of Russia Alexander Novak

According to the Russian minister,

“The recommendations we submitted were accepted: exclude condensate from monitoring. Go to monitoring by the methodology that is in OPEC. They do not take into account condensate, but only oil. The same methodology will be taken into account for non-OPEC countries. ”


Russia has the right to expect that gas condensate will be excluded from the calculation of quotas as early as December, although not all OPEC non-member countries have it. The volume of gas condensate that Russia produced a little more than a year ago, in October of the 2018 of the year when it entered into a deal called “two plus” with OPEC, amounted to 760 thousand barrels per day. They should be excluded when calculating the Russian quota. Given the steady growth in condensate production, this is a very important achievement.

Excluding gas condensate, Russia in November 2019 completed and even exceeded the “two plus” deal, as the reduction in oil production exceeded 100% of the quota. The old oil quotas laid down in it will be valid only until March 2020, and the December meeting in Vienna was already devoted to new standards.

As you know, the current agreement assumes a total reduction in oil production by 1,2 million barrels per day to the level of October 2018. At the same time, OPEC members are short of more than 800 thousand barrels and slightly less than 400 are not members. Of these 400 thousand, more than half of the reduction - 228 thousand barrels is in Russia.

During the negotiations last week, the total quota was planned to be increased either by 400 000 barrels per day, as Iraq and several other oil exporting countries proposed. Tamir Gadban, the Iraqi oil minister, insisted on this on Wednesday, who acknowledged the serious difficulties that his country was experiencing in carrying out an existing deal.


Iraqi Oil Minister Tamir Gabdan

The Wall Street Journal quoted the Iraqi Minister not without sarcasm: “it was estimated that 1,2 million barrels per day is not enough to maintain an acceptable price, an additional reduction to 1,6 million is required.” At the same time, the American business semi-official did not hide the hope that OPEC would not be able to agree not only with Iraq, but also with non-members of the consortium. And this promised a long-term decline in oil prices, beneficial primarily to the United States.

Shale Hangover


For American oil and gas moguls, now is the time for sobering up after shale euphoria. They clearly fear that OPEC, together with Russia and the other “affiliates,” will suddenly try again to return to extremely hard quotas at the level of 1,8 million barrels minus the level of October 2016. This could again push oil quotes to marks close to 100 dollars per barrel, ruinous for large buyers such as the United States.

Nevertheless, the growth of shale oil production is still continuing, albeit at a slower pace, and at the same time, production is growing due to new projects in Norway and Brazil. But demand can and should even slow down due to a slowdown in the global economy, which is clearly weakened by numerous trade wars and sanctions experiments.

Is it any wonder that on the eve of the Vienna debate, the international energy agency decided to reaffirm its recent warnings about the world's overproduction of oil? The agency recalled that production growth will be primarily in countries outside the OPEC. And already in 2020, the world may face a frightening overabundance of raw materials.

“As a preventive measure, the agreement between the OPEC and non-OPEC countries should be at least extended, and if surgery is required, then it should be supplemented,”

- wrote about this one of the Washington Post columnists.

But the outcome of the meeting in Vienna turned out to be something of a sedative to all at once. OPEC, supported by Russia, persuaded Iraq not to break into battle too much, but at the same time did not intimidate the United States, and in tandem with it was China, the second main buyer of “black gold”. Apparently, the factor regarding the trouble-free placement of shares in Saudi Aramco, this almost monopolist in Saudi Arabia, the almost sole leader in OPEC, also played a role.

Bloomberg experts noted that OPEC + ministers decided to further reduce oil production in general by 503 thousand barrels per day. Of these, 372 thousands were taken over by OPEC members, and 131 thousands of non-OPEC countries, including Russia. This almost accurately displays the total quotas in the middle between the maximum of 1,8 million barrels and the modest 1,6 million, which Iraq initially aimed at.

It is interesting that even the “cold” experts from Bloomberg could not help but pay attention to the fact that the meeting in Vienna turned out to be something like the benefit of Iraq, more precisely, the country's oil minister Tamir Gadban. Commenting on Iraq’s increased commitments, he said the decision was based on market analysis. But he admitted that "we (Iraq. - Auth.) Have difficulties with this, which are associated with internal problems ..."


We add on our own that these problems boil down to the fact that OPEC has more than 500 thousand barrels per day that are produced in Kurdistan, but this production is not controlled by the Iraqi government. No way. But Iraq will still have to solve the problem - through the purchase of half of the oil from Kurdistan or by some other means.
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  1. svp67
    svp67 10 December 2019 15: 06
    -2
    Why does Russia need gas condensate?
    Dilute gasoline with donkey urine, as the hero of one of the old Soviet films did ...
    1. NKT
      NKT 10 December 2019 15: 47
      +1
      The output of the gas fraction from gas condensate is greater than from oil - up to 85%
      1. New Year day
        New Year day 10 December 2019 19: 38
        +3
        Quote: NKT
        The output of the gas fraction from gas condensate is greater than from oil - up to 85%

        in the 90s, "craftsmen" refueled cars with condensate from the Glebovskoye field - for a long time the car did not run on such fuel
        1. NKT
          NKT 10 December 2019 21: 26
          0
          Was it stable or unstable? What kind of car?
          1. svp67
            svp67 11 December 2019 05: 59
            0
            Quote: NKT
            Was it stable or unstable?

            Yes, what kind of stable is it, it pulled out candles at once ...
    2. antivirus
      antivirus 10 December 2019 15: 50
      0
      in Kurdistan (Iraq) Erdogan grazes - do you have to please him?
  2. The leader of the Redskins
    The leader of the Redskins 10 December 2019 15: 09
    -2
    When it comes to the fact that yesterday it was necessary to abandon the policy of "country - gas station"! And it would be fine if it was scary to become pioneers, no - there are many examples of successful economies in countries where there are either no hydrocarbons, or the cat cried!
    1. max702
      max702 10 December 2019 15: 34
      -2
      Quote: Leader of the Redskins
      When it comes to the fact that yesterday it was necessary to abandon the policy of "country - gas station"! And it would be fine if it was scary to become pioneers, no - there are many examples of successful economies in countries where there are either no hydrocarbons, or the cat cried!

      Yeah .. He’ll eat, but will someone give him? (P.)
      They will close their sales markets .. I’m silent about the processing technologies and equipment .. The bourgeoisie grit their teeth so much that they have to measure the sale of crude oil and gas because their margins are very good there, including due to shares of oil and gas companies hands ..
      RS: I recommend that all non-believers get acquainted with the list of shareholders of Rosneft and Gazprom ..
    2. svp67
      svp67 11 December 2019 06: 00
      0
      Quote: Leader of the Redskins
      no - there are many examples of successful economies in countries where there are either no hydrocarbons or the cat wept!

      For example, Ukraine
  3. The comment was deleted.
  4. Sergey39
    Sergey39 10 December 2019 15: 33
    0
    In general, it is necessary to tie up with the sale of gas and oil abroad. Especially raw.
  5. kjhg
    kjhg 10 December 2019 16: 18
    +7
    Dear authors write that the agreement to reduce production is not beneficial to the United States. But let me doubt it. The United States today ranks first in the world in oil production. Production volumes continue to grow, with its reduction in other countries to maintain prices. Those. a further reduction in production by the Opek + countries is beneficial primarily to America, which continues to increase its share. There was a win-win situation for the USA. If Opek + fails and ceases to reduce production, which in the end is inevitable, the oil price will collapse and the United States will buy it cheaply for its needs abroad, preserving its wells. In the meantime, prices are high, they will continue to increase production and conquer the market. The main losers in this situation were the Trust + countries, which include Russia.
    1. nikon7717
      nikon7717 10 December 2019 23: 28
      0
      Why? Just these countries are all profitable. There is less production, the price is higher, and as a result, the income per unit / barrel is higher. And there are more reserves left, and ecology will do less harm once they burn less.
      It’s bad that we don’t invest in processing. Who knows why? Or are there any ideas about a conspiracy on this subject? smile
    2. Chaldon48
      Chaldon48 11 December 2019 01: 29
      0
      The most surprising, but Russia in any situation is the loser, the United States is the winner.
  6. parusnik
    parusnik 10 December 2019 17: 34
    +1
    But Iraq will still have to solve the problem - through the purchase of half of the oil from Kurdistan or by some other means.
    .... Rather, they will redeem ... they will not give another way, they will not give ... Yes, for another way another leader is needed ... and a flock ... And this is not in Iraq now ....
  7. Ros 56
    Ros 56 10 December 2019 18: 23
    0
    Novak, and the whole fuel and energy complex, has long had to knock on the head. They fill their pockets, but they really don’t know how to work.
  8. Nyrobsky
    Nyrobsky 10 December 2019 18: 46
    +4
    Moreover, due to a decrease in business activity and a series of warm winters in Russia, fuel consumption has been growing very slightly for several years.
    Well, yes, it would certainly be strange if fuel consumption in Russia grew due to the fact that domestic fuel prices have been rising for several years as well. The price of gasoline will decrease, demand will increase, the domestic fuel market will become more capacious, transportation and cargo turnover will increase, the economy will suffocate ..... there is no other way. But our government thinks differently and increases excise taxes and tax levies on each liter of gasoline sold, thereby artificially stimulating a decrease in fuel demand and, as a consequence, a slowdown in economic growth. Or am I misunderstanding something? request
    1. New Year day
      New Year day 10 December 2019 19: 40
      +4
      Quote: Nyrobsky
      The price of gasoline will decrease, demand will increase,

      in the budget for 2020, the price of gasoline is 50 rubles / liter, so we have no prospects in this direction
      1. Nyrobsky
        Nyrobsky 10 December 2019 20: 44
        +3
        Quote: Silvestr
        Quote: Nyrobsky
        The price of gasoline will decrease, demand will increase,

        in the budget for 2020, the price of gasoline is 50 rubles / liter, so we have no prospects in this direction
        It is clear that there are no prospects, but Sylvester, I'm not talking about the prospect of price increases for the 20th year, but about how the price of gasoline works in conjunction with the economy, using a scheme to reduce the cost of a liter in the domestic market, which pulls everything else along. For example, sugar. The price of this powder has recently reached 60 rubles per kg. demand dropped. Enterprises and sown areas did not decrease, the harvest was record, there was an overproduction, in order to stimulate sales, the manufacturer went to reduce prices. Now sugar is 25 rubles per kilo. People take it, make jam. But in terms of gasoline and oil, this does not happen in our country, and for a number of years there has been an increase in prices on the domestic market, regardless of the cost of a barrel of oil or record production. If there is a need to reduce the volume of production and external supply, then why not let the excess volume go to the domestic market, reduce the price and cheer up the economy? There is a real opportunity for this, but there is no state will and desire to cheer up this economy, and therefore this cannot be called anything other than sabotage. Russia is deliberately and controllably kept in the conditions of "planned containment of economic growth." By the way, the minus is not mine hi
        1. New Year day
          New Year day 10 December 2019 22: 56
          +5
          Quote: Nyrobsky
          Why do not let the excess volume go to the domestic market, reduce the price and cheer up the economy?

          in the summer, I saw a picture depressing me: a man drove up to a trash in a car and began throwing watermelons out of the trunk. And threw them with force so that they are guaranteed to crack. He asked - why, because you can give to people? The answer is that it’s better to rot, but I will not give it lower than the price, we must maintain the sale price.
          This is an ordinary merchant, but what about sharks? For a penny strangle hi
          1. Nyrobsky
            Nyrobsky 10 December 2019 23: 47
            +2
            Quote: Silvestr
            This is an ordinary merchant, but what about sharks? For a penny strangle

            Yeah. But before they can strangle themselves, they are also ready to strangle a bunch of people. hi
  9. 123456789
    123456789 16 December 2019 17: 14
    0
    Quotation is necessary not for production, but for oil export