OPEC+ supply gap widens in March as sanctions hit Russian output

OPEC+ produced 1.45 million barrels per day (bpd) below its production targets in March, as Russian output began to decline following sanctions imposed by the West, a report from the producer alliance seen by Reuters showed.

The report showed that Russia produced about 300,000 bpd below its target in March at 10.08 million bpd, based on secondary sources.

Compliance with the production cuts rose to 157% in March, from 132% in February, the data showed, the highest since the group introduced record production cuts of about 10 million bpd in May 2020 to counter the impact of the pandemic on demand.

OPEC+, which groups OPEC and allies led by Russia, agreed last month to another modest monthly oil output boost of 432,000 bpd for May, resisting pressure by major consumers to pump more.

As the group unwinds production cuts, several producers, namely West African countries struggling with underinvestment and an exodus of international energy companies, are failing to keep up.

At its meeting last month, OPEC+ also ditched the Paris-based International Energy Agency (IEA) as one of its secondary sources, replacing it with consultancies Wood Mackenzie and Rystad Energy.