The number of active wells at a five-year high doesn't work, and it remains difficult for Russia to increase production

Despite Russia's highest number of active wells since 2017, the country is struggling to resume crude production
that has been cut due to the production cut agreement.

According to statistics from the CDU-TEK division of the Russian Ministry of Energy, the number of active oil wells in Russia reached 155,600 in December 2021, the highest
since 2017.
However, despite a sharp rise in Russia's crude production in December, the country's monthly crude oil production fell below its OPEC+ quota
for the first time since OPEC+ gradually eased production restrictions.

The number of active wells in Russia reached its highest level since 2017, and the number of active wells in Russia reached its highest
level since 2017.

The data show that Russia faces challenges
in restoring oil production after experiencing the worst production restrictions and reduced upstream investment.
Analysts say Russia may only be able to achieve about
half of its planned increase in crude production in the next six months.

OPEC+ members have been struggling to recover oil production that has been cut after the outbreak and are facing dwindling spare capacity
.
And as global demand recovers, this factor could push oil prices
higher for the rest of the year.

Driven by tight global supply and a strong recovery in global demand, WTI and Brent both reached seven-year highs last week
.
Earlier, the International Energy Agency (IEA) said the oil market looked tighter
than previously expected.
A growing number of analysts predict that Brent crude prices will rise to $90 a barrel due to tighter supply and could exceed $
100 a barrel in the second half of the year.

As of press time, Brent crude futures rose 0.
44% to $87.
56 per barrel; WTI crude futures rose 0.
33% to $85.
88 a barrel
.

Russia expects to return its oil production to pre-pandemic levels by April or May, provided OPEC+ increases its monthly quota by 100,000 b/d
, Russian Deputy Prime Minister Alexander Novak said.
However, Russia's lackluster oil production growth in December and the lack of factors to boost production in the short term suggest that achieving this goal may take longer
.

BCS Global Markets analysts said: "As summer approaches, Russian oil production may not be able to keep up with the increase in quotas, or even fall below its production quotas
.
" By July, Russia's oil production could be about 240,000 barrels
per day below its quota.
”