Russia drilled the most oil wells in Russia in the past decade, even though giants such as BP and Shell left the country.
According to Bloomberg data, Russian oil rigs reached a depth of nearly 28,000 km last year. However, the number of wells that were started grew by almost 7 per cent over 7,800.
Despite Europe imposing export restrictions on the country’s energy sector, the activity helped oil production to rebound in the second quarter of 2022. Western companies also stopped working there.
Vitaly Mikhalchuk is the head of the Research Centre at Business Solutions and Technologies. He said that “This industry largely keeps working just as before.”
“Russia was able to keep most of the oil-service capabilities, assets, and technologies.”
This comes just a month after Russia announced that it would reduce oil exports by 500,000 barrels starting next month, a move which triggered an increase in oil prices.
Kadri SIMSON, EU commissioner for energy, stated that the cut was not voluntary. It was made in response to Western sanctions.
He stated that they lack the technology to maintain production levels.
The most significant change in Russia’s oil sector since the collapse of the Soviet Union was Vladimir Putin’s decision almost a year ago to invade Ukraine. In April, production fell to just over 10m barrels per day.
Despite huge companies such as Shell, BP, and Exxon stopping operations in the country, the industry managed to recover to produce approximately 10.9m barrels per day by the end of 2022.
According to Vygon Consulting data, 15% of Russia’s total oil services sector was owned by top international producers.
The market is dominated by domestic producers such as Rosneft and Surgutneftegas, Gazprom and Gazprom.
Despite the invasion of Ukraine, Western providers such as Weatherford International and SLB remained in the country.
Olivier Le Peuch, chief executive of SLB, stated in July that his company’s unique structure allowed it to be flexible enough to work in Russia and still comply with US sanctions.
Weatherford stated last year that it had stopped “any new investments, or deploying new technology” in Russia.
