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5 Aug, 2023 08:27

Russia makes new pledge to help ‘balance’ oil market

The world's second-largest oil exporter had previously announced a production cut of 500,000 barrels per day
Russia makes new pledge to help ‘balance’ oil market

Russian oil producers will reduce exports by 300,000 barrels per day (bpd) starting from September, according to Deputy Prime Minister Alexander Novak, who said the move will help to ensure balance of supply and demand on the global market.

The world's second-largest oil exporter after Saudi Arabia, Russia has already pledged to curb production of crude by some 500,000 bpd, or nearly 5% of its output, from March until the end of this year.

"As part of efforts to ensure the oil market remains balanced, Russia will continue to voluntarily reduce its oil supply in the month of September, this time by 300,000 bpd, reducing exports by that quantity to global markets," the top official said on Thursday in an interview with the TV channel Rossiya 24.

Saudi Arabia previously announced plans to extend a voluntary oil output cut for at least another month, to support global crude prices into September. The kingdom's production for that month will be around nine million bpd. Riyadh added that the cut could be extended beyond that, or deepened.

OPEC+, which comprises the Organization of the Petroleum Exporting Countries (OPEC) and allies (including Russia), agreed in October to cut its output by about 2% of world demand from last November until the end of 2023. The group later agreed to additional curbs, all in an effort to balance out the market.

Global oil prices have grown significantly since Russia and Saudi Arabia announced supply cuts in early July, with Brent crude surging from around $76 per barrel to above $85 currently.

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