Following the imposition of a price cap on oil products by major economies, Russia will cut its crude oil production by 500,000 barrels per day starting in March. Following the cut's announcement by Alexander Novak, deputy prime minister of Russia, oil prices increased.
The price that the European Union, G7 countries, and Australia will pay for crude oil and refined goods is limited. These are a part of the sanctions imposed by the West on Russia as a result of its involvement in the war in Ukraine.
One of the world's top oil producers is Russia. The price of Brent crude, the global standard for oil prices, increased by 2.2% to $86 per barrel as a result of its planned cuts.
As Russia's invasion of Ukraine progresses, Western nations have been imposing tougher oil sanctions in an effort to reduce the Kremlin's profit from sales and its ability to fund the conflict.
The most recent restriction on Russian imports of refined oil products like diesel by sea entered into force this week. The access of traders to tanker fleets and insurance markets is restricted for those who violate these sanctions.
In the case of the oil price cap, nations ceased using maritime insurance, financing, and brokering services from the West for Russian oil that was transported by sea and sold for more than $60 per barrel as of 5 December.
Russia has responded by outlawing any agreements involving the cap.
Novak said: "As of today, we are fully selling the entire volume of oil produced, however, as stated earlier, we will not sell oil to those who directly or indirectly adhere to the principles of the 'price cap'.
"In this regard, Russia will voluntarily reduce production by 500,000 barrels per day in March. This will contribute to the restoration of market relations."
Despite the sanctions, all of Russia's output has so far been able to find buyers, according to Novak.
According to industry sources who spoke to the BBC, businesses have recently purchased hundreds of tankers, forming a so-called "dark fleet" ready to transport Russian crude at higher prices.
The last significant decline in Russian oil production occurred in April of last year, when it dropped by almost 9% as a result of Western sanctions over Ukraine.
However, Russia has since established logistics networks for its oil sales, primarily in Asia. Russian oil production increased by 2% to 10.7 million barrels per day in the previous year.
(Source:www.reuters.com)
The price that the European Union, G7 countries, and Australia will pay for crude oil and refined goods is limited. These are a part of the sanctions imposed by the West on Russia as a result of its involvement in the war in Ukraine.
One of the world's top oil producers is Russia. The price of Brent crude, the global standard for oil prices, increased by 2.2% to $86 per barrel as a result of its planned cuts.
As Russia's invasion of Ukraine progresses, Western nations have been imposing tougher oil sanctions in an effort to reduce the Kremlin's profit from sales and its ability to fund the conflict.
The most recent restriction on Russian imports of refined oil products like diesel by sea entered into force this week. The access of traders to tanker fleets and insurance markets is restricted for those who violate these sanctions.
In the case of the oil price cap, nations ceased using maritime insurance, financing, and brokering services from the West for Russian oil that was transported by sea and sold for more than $60 per barrel as of 5 December.
Russia has responded by outlawing any agreements involving the cap.
Novak said: "As of today, we are fully selling the entire volume of oil produced, however, as stated earlier, we will not sell oil to those who directly or indirectly adhere to the principles of the 'price cap'.
"In this regard, Russia will voluntarily reduce production by 500,000 barrels per day in March. This will contribute to the restoration of market relations."
Despite the sanctions, all of Russia's output has so far been able to find buyers, according to Novak.
According to industry sources who spoke to the BBC, businesses have recently purchased hundreds of tankers, forming a so-called "dark fleet" ready to transport Russian crude at higher prices.
The last significant decline in Russian oil production occurred in April of last year, when it dropped by almost 9% as a result of Western sanctions over Ukraine.
However, Russia has since established logistics networks for its oil sales, primarily in Asia. Russian oil production increased by 2% to 10.7 million barrels per day in the previous year.
(Source:www.reuters.com)
Homepage
Send to a friend
Printable version
Share
