Russia will cut its oil production by about 5 percent next month. With this measure, Deputy Prime Minister Alexander Novak responds to import bans and price caps from Western countries. As a result, Moscow has seen the revenues from its oil production shrink.
These production cuts are likely to cause global oil prices to rise.
This way, Russia has relatively more money left over from smaller oil production. According to Novak, who had previously threatened with this measure, this should “restore market relations”.
Instead, Russia’s oil income has fallen sharply due to the lower market price. Moscow also had to offer its products at high discounts because few countries wanted the fuel out of the country because of the war in Ukraine.
Russia’s cut of 500,000 barrels per day in March, on a daily output of nearly 11 million last month, comes on top of oil cartel OPEC+’s output cuts late last year. That restriction of 2 million barrels per day from the alliance of oil-producing countries will remain in place until the end of this year. This also has a price-increasing effect.