Novak announced the extension of the voluntary reduction in oil production until June
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Russia’s decision to voluntarily cut oil production by 500,000 bpd will remain in effect until June, Russian Deputy Prime Minister Alexander Novak said. writes TASS.
“In accordance with the current market situation, the decision to voluntarily reduce production in the amount of 500,000 bpd will be valid until June 2023, inclusive,” he said.
Novak added that Russia would soon reach its production cut target. In February Novak declaredthat Russia will cut oil production by 500,000 barrels per day in March. According to him, this step will contribute to the restoration of market relations. In the same month, Deputy Prime Minister saidthat the risks of a decline in oil production in Russia in 2023 remain, the government will assess them in the near future.
Earlier, he noted that despite the embargo imposed in January, Russia was able to maintain the level of oil production at the level of November-December 2022, it amounted to approximately 9.8-9.9 million barrels per day. According to the Deputy Prime Minister, the Russian oil industry will continue to work steadily.
Since December 5, 2022, the oil price ceiling introduced by the G7 countries (G7, includes the UK, Germany, Italy, Canada, USA, France, Japan) and the European Union (EU) has been in effect. It is set at $60/bbl.
Later, they set a limit on export prices for expensive oil products from Russia (for example, diesel) at $100/bbl, and for cheaper ones (fuel oil) at $45/bbl, the restrictions came into force simultaneously with the ban on offshore deliveries of oil products from Russia in the EU on February 5th.
In response to these restrictions, Russian President Vladimir Putin signed a retaliatory decree on December 27, 2022, according to which Russia will not supply oil if the contracts explicitly or implicitly provide for a price cap mechanism. It is emphasized that this measure is applied at all stages of deliveries to the final buyer. The document entered into force on February 1.
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