Yellen does not consider production cuts as a reason for changing the ceiling for oil prices from Russia

US Treasury Secretary Janet Yellen sees no reason to change the price ceiling for Russian oil after eight countries, including Russia, decided to cut oil production. In her opinion, this will not have a significant impact on the price cap.

Ms. Yellen, speaking at Yale University, noted that the countries of the Western coalition could revise the price ceiling, which is currently set at $60 per barrel, if such a decision is “deemed appropriate.” “But I don’t see it as appropriate at the moment,” she said (quoted from Reuters).

The US Treasury Secretary believes the oil price ceiling is “working”. In her opinion, this measure led to an increase in the discount on Russian raw materials and strengthened the position of buyers in the negotiation process.

Ms. Yellen called the decision to cut production “not a constructive step.” In her opinion, this “is not a positive factor for global growth.” US President Joe Biden, commenting on the OPEC+ decision, saidthat it “won’t be as bad as you think”.

Saudi Arabia and other major Arab oil producers – the UAE, Iraq and Kuwait – decided on April 2 to support Russia’s efforts and unilaterally cut production. We are talking about a reduction of 1 million barrels per day from May until the end of the year, while Russia will extend for the same period the reduction in production by 500 thousand barrels already begun in March. This led to an increase in the price of oil. According to Western analysts, an increase in oil prices will push inflation and make it even more difficult for the US Federal Reserve to find a balance between increasing the key rate and maintaining financial and economic stability.

Read more about the reduction in production – in the material “Kommersant” “Foreign countries did not let us down”.

Leonid Uvarchev