Russia To Slash Oil Output By 500,000 bpd Next Month

Russia will cut oil production by 500,000 barrels per day (bpd), or around 5% of output, in March, Deputy Prime Minister Alexander Novak said, Vladimir Soldatkin and Olesya Astakhova reported for Reuters.

Photo Insert: Moscow’s decision also came as the West imposed price caps on its oil and gas exports, pushing the Russian government’s budget deficit to rise $25 billion last month.

Novak’s announcement was not a surprise to Western and European governments that had already slashed more than 60% of their oil and gas imports from Russia. Novak admitted the decision was made without consultations with foreign governments, including China and India.

However, in reaction to the news, the price of Brent crude shot up 2.5% in world markets. Moscow’s decision also came as the West imposed price caps on its oil and gas exports, pushing the Russian government’s budget deficit to rise $25 billion last month.

Aside from the oil price cap, the Associated Press (AP) reported that insurers and reinsurers have refused to provide cover for ships transporting oil and gas, pushing India and other buyers to use state-owned vessels to ferry their oil and gas, Ahmad Ghaddar and Rowena Edwards reported for Reuters.

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