Russia decided to reduce oil exports in August by 0.5 million barrels. per day

RUSSIA in August will reduce exports by an additional 0.5 million barrels. oil per day to "ensure the balance of the market," said Deputy Prime Minister Alexander Novak. Moscow has already reduced production by 0.5 million barrels since March. to “restore” the market

As part of “efforts to ensure market balance”, Russia will voluntarily reduce oil exports by 500,000 barrels in August 2023. per day. Deputy Prime Minister Alexander Novak told reporters about this, RBC correspondent reports. We are talking about an additional reduction in production by this volume, he added. That is, taking into account the already existing decline, production in August will be reduced by 1 million barrels. compared to February 2023. To what level supplies to international markets are being reduced, the vice-premier did not specify.

On Monday, Saudi Arabia's state agency also said, citing an official source in the Kingdom's Energy Ministry, that it would extend into August a voluntary cut in oil production, adopted for July, in the amount of 1 million barrels. per day, up to about 9 million barrels. per day. “This additional voluntary cut is intended to reinforce the precautionary measures being taken by OPEC+ to keep oil markets stable and balanced,” the source said. “I would call a 'Saudi sweetie' a 1 million barrel cut. per day from July 1 (for a month), and this can also be extended, ”said Saudi Energy Minister Prince Abdulaziz bin Salman in early June following the OPEC + ministerial meeting, where it was decided to reduce production quotas in 2024 year,

At the beginning of 2023, the Russian government decided to voluntarily cut production from March 1 by the same 500,000 barrels. per day (about 5%), but then this decision was considered as temporary. Then Novak explained that it "will contribute to the restoration of market relations."

The Deputy Prime Minister assumed at the end of 2022 that at the beginning of this year, oil production could be reduced by about 500-700 thousand barrels. per day, or by 5–7%, due to the European embargo on oil imports from Russia and the introduction of a price ceiling for third countries, joined by the G7 ( United States , CANADA , United Kingdom , France , Germany , Italy and Japan ) and Australia . The G7, the EU and Australia form a price-capping coalition formed in response to a Russian military sting operation in Ukraine that seeks to cut revenues .Moscow from EXPORT. Novak then said that this was an insignificant amount, but "such risks exist."

However, in April it was decided to extend the voluntary production cut by 500 thousand barrels. until the end of 2023 as a preventive measure against the backdrop of the global market situation. “Today, the global oil market is experiencing a period of high volatility and unpredictability due to the ongoing banking crisis in the US and Europe, global economic uncertainty and unpredictable and short-sighted decisions in energy policy,” the Deputy Prime Minister explained.

On Monday, July 3, even before Novak's statementBrent crude rose 2% to $76.5 per barrel.