Russia will lower oil manufacturing from subsequent month in response to the worth cap imposed by western nations, the nation’s high vitality official mentioned, within the first signal Moscow is transferring to weaponize oil provides after slashing pure gasoline exports to Europe final 12 months.
The lower of 500,000 barrels a day, the equal of about 5 per cent of Russia’s manufacturing or 0.5 per cent of world provide, will assist “restore market relations”, Alexander Novak mentioned in an announcement on Friday.
The announcement comes days after the newest EU sanctions and different western measures in opposition to the Russian oil sector took impact in retaliation for Moscow’s full-scale invasion of Ukraine and simply two weeks earlier than the one-year anniversary of the beginning of the warfare.
The EU prolonged its ban on seaborne imports of Russian crude to cowl refined fuels similar to diesel and petrol on February 5, whereas the G7 concurrently imposed a value cap on the identical fuels patrons should abide by if they’re to entry western tanker and insurance coverage markets.
Novak, who’s deputy prime minister and leads Russia’s negotiations with the Opec+ group of oil producers, has lengthy warned that Moscow might retaliate in opposition to western measures designed to hit its oil revenues.
“Russia believes the worth cap mechanism for promoting Russian oil and oil merchandise interferes with market relations,” Novak mentioned. “It continues the damaging vitality coverage of the international locations of the collective west.”
Brent crude, the worldwide benchmark, jumped 2.3 per cent to $86.43 a barrel instantly after the announcement on Friday, having earlier traded largely flat on the day.
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