Russia reduced oil output by bpd 700,000 in March

On Friday, Russia said that it reduced daily oil production in March by 700,000 barrels. That was a greater decrease than the 500,000 barrels per day that the nation had previously committed to. The decreased output coincides with OPEC+’s promise to lower production by 1.1 million barrels per day beginning in May.
However, the number triggers however, raises questions about how much oil Russia actually produced because it is inconsistent with supplies to local refineries and seaborne exports from the nation. In response to Western sanctions and energy price ceilings over its invasion of Ukraine, Russia said in February that it will reduce its crude oil production by 500,000 barrels per day for the entire month of March.

Aleksandr Novak, the deputy prime minister of Russia, stated on Sunday that the output restrictions would be extended through the end of the year after already extending them through June. On the back of his comments, oil markets rallied, indicating the potential for crude prices to return to $100 a barrel this year.

The collective reduction in the commodity’s supply may also cause future volatility and force Western nations to reassess the $60 price cap on Russian oil. OPEC nations pursued the cutbacks following a momentary drop in oil prices during March’s banking turmoil and fears of a recession that could hurt energy demand.

Data shows that Russia pumped around 1.285 million tons of crude oil a day, or over 9.4 million barrels. At the same time, exports of the commodity grew considerably, up 4.13 million barrels a day in the last week of March.