Russia cuts oil production because of the price ceilings

The Russian Federation said it would reduce oil production by up to 500,000 barrels per day due to the ceiling prices set by the West as part of the sanctions for the war against Ukraine.

This was reported by the Associated Press.

Deputy Prime Minister Alexander Novak said that Russia is now fully selling off the oil it produces, but will not sell oil to those who directly or indirectly adhere to the ceiling price, and in connection with this, Russia by its decision to reduce production to 500 thousand barrels per day.

Industry experts had previously conceded such a move by Moscow in an attempt to raise the price of oil because there would be less of it on the global market, which, in turn, could raise fuel prices.

The benchmark Brent crude rose 1.5% on Friday and was selling for $85.75 a barrel.

It is hard to predict the extent to which Moscow's decision will influence the future situation, as the trend of slowing the global economy is reducing the demand for oil.

Author - Olena Madiak, 11/02/2023