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29 May, 2023 08:03

Saudi Arabia calls Russia out over oil output – WSJ

Riyadh alleges that Moscow hasn’t actually cut the 500,000 bpd that it promised, the media outlet reports
Saudi Arabia calls Russia out over oil output – WSJ

Saudi Arabia has accused Russia of not entirely fulfilling its pledge to curb oil production in response to Western sanctions, the Wall Street Journal reported on Saturday, citing people familiar with the matter. 

Riyadh has reportedly complained to senior Russian officials about the matter and asked Moscow to honor the output cuts of 500,000 barrels per day (bpd) that the two biggest oil producers in the OPEC+ group agreed in April to make. 

The curbs, which took effect in May and are set to last until the end of 2023, were aimed at supporting global oil prices. The total volume of oil taken off the market was expected to be 1.66 million barrels per day. The decision came as an additional step following the OPEC+ agreement to collectively reduce oil output by 2 million bpd that came into effect in November 2022.

In February, Russian Deputy Prime Minister Aleksandr Novak said that Russia would voluntarily reduce oil production in March by 500,000 barrels per day as the nation halted sales to buyers that complied with a Western-imposed price cap. The measure was then extended until June, and later until the end of the current year.

Since then, the official has reportedly said that Moscow is abiding by its voluntary pledge to cut oil output by 500,000 barrels a day from March until the end of 2023. 

“Taking into account the unfounded speculation in the press regarding oil production levels, Russia reaffirms its full commitment to and implementation of voluntary oil production cut levels,” Novak said in a statement earlier this month.

Meanwhile, the International Energy Agency had previously reported that Russian oil exports reached a 14-month high in April, with the lion’s share going to Asian markets amid Western sanctions. The report also suggested that Russia hadn’t fully implemented the planned production cuts. The agency estimates that the country’s oil trade revenues amounted to $15 billion in April, an increase of $1.7 billion on the month.

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