Fears emerge over Russia’s oil output
By Carola Hoyos and Javier Blas in London
Published: April 14 2008 22:10 | Last updated: April 15 2008 15:43
Russian oil production has peaked and may never return to current levels, one of the country’s top energy executives has warned, fuelling concerns that the world’s biggest oil producers cannot keep up with rampant Asian demand.
Leonid Fedun, the 52-year-old vice-president of Lukoil, Russia’s largest independent oil company, told the Financial Times he believed last year’s Russian oil production of about 10m barrels a day was the highest he would see “in his lifetime”. Russia is the world’s second biggest oil producer.
Mr Fedun compared Russia with the North Sea and Mexico, where oil production is declining dramatically, saying that in the oil-rich region of western Siberia, the mainstay of Russian output, “the period of intense oil production [growth] is over”.
The Russian government has so far admitted that production growth has stagnated, but has shied away from admitting that post-Soviet output has peaked.
Viktor Khristenko, Russia’s energy minister who is pushing for tax cuts that could stimulate investment, said last week: “The output level we have today is a plateau, stagnation.”
Russia was until recently considered as the most promising oil region outside the Middle East. Its rapid output growth in the early 2000s helped to meet booming Chinese demand and limited the rise in oil prices.
It’s all over but the crying, people. Get ready for some really hard times, and I don’t mean the modest recession we’re seeing now, I mean some Depression-caliber save-that-ball-of-twine kind of belt-tightening. Our government and our media won’t tell you this, but I will.
If only, instead of throwing billions into an Iraqi quagmire to save our energy bacon we’d instead invested in a new energy future, maybe something that involves concentrated solar power or hydrogen fuel cells or who knows what else.
But we put an oil man in the White House. What did we think he was going to do? Stupid, stupid, stupid.