Russia to slash crude oil production by 500k barrels per day in March

Is it time to say hello (again) to $100 this summer?

Russia announced on Friday that it would slash production levels by 500,000 barrels per day (bpd) in March following Western bans on Moscow’s crude oil and petroleum products.

This will represent approximately five percent of Russia’s total volumes.

Deputy Prime Minister Alexander Novak stated in the announcement that this would “help restore market relations” after global energy markets have started off the year in negative territory.

“As previously stated, we will not sell oil to those who directly or indirectly adhere to the principles of the ‘price ceiling,'” Novak said.

But could there be some disagreement between the Organization of the Petroleum Exporting Countries (OPEC) and OPEC+? Reportedly, the Kremlin did not consult with the coalition first before this decision.

So, how are energy markets responding to this news?

March West Texas Intermediate (WTI) crude oil futures rose more than 1.3% to above $79 a barrel on the New York Mercantile Exchange. April Brent crude futures advanced 1.5% to nearly $86 per barrel on London’s ICE Futures exchange.