Russian H1 oil output falls first time in decade

Russian oil output edged up 0.3 percent in June from the previous month, but was down almost 1 percent in the first half of the year, casting further doubts over the government's goal to sustain growth this year. Russian officials still hope production would slightly rise this year as the government seeks to avert the first annual decline in output since 1998. But analysts say Russia cannot sustain production growth, at least not until next year when new fields in East Siberia will come onstream to compensate for falling production from depleted deposits in West Siberia. Stagnant Russian production has been a concern for global oil markets in the past year. Crude prices are at record highs over $140 a barrel and the International Energy Agency predicts that supplies will fail to keep up with demand in the long term.
The decline also comes as Russia's No.3 oil producer TNK-BP, half owned by BP, warns that its output growth is at risk this year due to a protracted corporate conflict between BP and its Russian billionaires co-owners over the firm's strategy and management tactics.
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