Russia will slash its crude oil output by five percent next month, Deputy Prime Minister Alexander Novak announced Friday, in response to a price cap imposed by Western countries.
“Russia will voluntarily reduce production by 500,000 barrels per day in March. This will help restore market relations,” Novak said, according to Russian news agencies, adding that the decision was taken by Moscow unilaterally.
Russia is part of an alliance with OPEC that meets regularly to decide on oil output levels. As a result of Moscow’s military operation in Ukraine, the West has capped the price at which Russia can sell its crude.
News of Russia’s cut to output gave strength to world oil prices Friday.
The international benchmark, Brent North Sea crude, leaped 2.3 percent to $86.48 per barrel.
New York contract WTI soared 2.5 percent to $80.01.
“Oil moved up strongly… as Russia’s Deputy Prime Minister Novak said the country will cut output by 500,000 barrels from March,” noted Neil Wilson, an analyst at trading group Finalto.