Russia running out of money for new oil wells as drilling hits three-year low – Bloomberg

Russia's oil producers have cut drilling to the lowest level in three years, denting prospects for output growth this year as tougher western sanctions and a strong rouble squeeze revenues.

Source: Bloomberg

Details: Drilling rigs in Russia drilled about 29,140 km of production wells in 2025, down 3.4% from 2024, Bloomberg News reports, citing industry data.

After a record pace in the early months of 2025, activity began to slow in June. In December, drilling fell by about 16% compared with the same month a year earlier, data shows.

The slowdown comes as Russian producers face pressure from lower global oil prices, deeper discounts on their crude because of tighter western sanctions and a stronger rouble, which has made exports less profitable.

Meanwhile, the Organisation of the Petroleum Exporting Countries (OPEC) and its allies are reviewing how much their members can produce in the years ahead, seeking to better align output quotas with actual capacity.

Oil output in Russia, the de facto leader of OPEC+ alongside Saudi Arabia, has already been falling for two consecutive months amid export restrictions. Weaker drilling could add to the pressure as the alliance considers its next steps on supply policy.

Background: Stronger US sanctions, which have pushed the price of Russian oil to US$40 a barrel or lower, have already led to a string of bankruptcies among smaller oil companies in key oil-producing regions of Russia.

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