Russia's Crude Oil Production Hit a Record High of 518 Million Mt in 2012

Russia's crude oil production hit a record high of 518 million mt (10.4 million b/d) in 2012, preliminary data released Wednesday by the energy ministry's Central Dispatching Unit showed, as the country cemented its position as the world's biggest oil producer. 

Crude output was up 1.3% year on year, the data as reported by AFP showed, and represents a new post-Soviet era high. 

It is the third consecutive year that Russian crude production has exceeded 10 million b/d, and keeps it ahead of Saudi Arabia as the world's biggest oil producer. 

The growth in oil output over the course of 2012 reflected an upward trend throughout the year, which saw production top 10 million b/d every month. 

The increase, as in 2010 and 2011, came mainly from the continued ramp-up of output at fields such as Rosneft's Vankor field in East Siberia and TNK-BP's Uvat project in West Siberia. 

The rate of increase seen in Russia's crude production had been expected to slow as the effect of the startup of several major new fields gradually diminished, though producers in East Siberia continue to ramp up output. 

Producers such as Lukoil have also managed to successfully halt the decline in oil production from more mature regions such as West Siberia. 

Russia's energy minister Alexander Novak said in October the country's oil production this year was expected to total 3.76 billion barrels, or an average of 10.3 million b/d. 

Analysts at Renaissance Capital expect production to now flatten out and do not anticipate major production growth again until significant new fields come online in 2015. 

GAS OUTPUT SLIDE 

While Russian oil production continues its slow rise, natural gas output slipped in 2012. 

It was down by 2.3% to 655 billion cubic meters, the CDU data as reported by AFP showed. 

Demand for Russian gas in its main European markets slumped last year, and Russia was unable to make up for the shortfall in the domestic market or through exports elsewhere. 

Russia is still largely dependent on Europe for its more lucrative gas exports. 

In 2011, Russia's gas output hit 670.5 Bcm, 3.1% up 2010. In 2010, Russia produced 650.3 Bcm of gas, up 11.5% from 2009's level.