Russian oil output will rise by 2.9 per cent or 270,000 barrels per day this year as the country has entered a period of modest growth after impressive spikes in previous years, a poll showed.

A poll of 19 analysts showed the industry was generally more optimistic about the sector's prospects than the country's Energy Ministry, which says production might remain flat this year at around last year’s levels of 9.42-9.43 million bpd.
Analysts said the main reason behind output growing to an average of 9.7 million bpd would be incremental production from firms such as LUKOil, TNK-BP and Rosneft as well as new barrels from Exxon Mobil's newly launched project on the remote Sakhalin island.
Production at the remaining units of fallen oil firm Yukos will be the main concern in the short-term should the state order it to be further carved up to recover back taxes.
In the long-term, growth will largely depend on new areas such as East Siberia, which can be developed only if the country quickly builds new export pipelines to Asia.
“The growth in Russian production is becoming more capital intensive because it is becoming more reliant upon green-field investment,“ said Leonid Mirzoyan from Dresdner.
After having almost halved from the levels seen under the Soviet Union and falling to as low as six million bpd in the end of the 1990s, Russian production has shown spectacular growth with a rebound of more than 50 per cent since 1999.
The country was regularly adding between 400,000-800,000 bpd in annual output earlier this decade and was the main source of extra non-Opec crude for world markets.
Production rose by nine per cent in 2004 and by a record 11 per cent in 2003 but has slowed to a mere 2.7 per cent this year due to a Kremlin-led campaign to crush the previous industry leader Yukos and its politically-ambitious owners.
Analysts also say the slow-down was due to the fact that oil firms have exhausted the potential of fields in West Siberia.