MOSCOW (AP) 鈥� Russia announced Friday that will cut oil production by 500,000 barrels per day next month after over its action in Ukraine.
鈥淎s of today, we fully sell all our crude output, but as we stated before, we will not sell oil to those who directly or indirectly adhere to the 鈥榩rice ceiling,鈥欌�� Deputy Prime Minister Alexander Novak said in remarks carried by Russian news agencies.
鈥淚n connection with that, Russia will voluntarily cut production by 500,000 barrels a day. It will help restore market-style relations,鈥� he said.
Analysts have said one possible Russian response to the cap would be to slash production to try to raise oil prices, which at the pump as less oil makes it to the global market.
International benchmark Brent crude rose 2.2% Friday, to $86.42 per barrel.
The Group of Seven major democracies have imposed a shipped to non-Western countries. The goal is to keep oil flowing to the world to prevent price spikes that were seen last year, while that can be used to pay for its campaign against Ukraine.
The cap is enforced by barring Western companies that largely control shipping and insurance services from moving oil priced above the limit.
Russia has said it will not sell oil to countries observing the cap, a moot point because Russian oil has been trading below the price ceiling recently. However, the cap, an accompanying and lower demand for crude have meant that customers in India, Turkey and China have been able to push for substantial discounts on Russian oil.
The impact of a cut of 500,000 barrels per day is an open question as a reduces the thirst for oil.
The OPEC+ alliance of oil producers, which includes Russia, tried to boost oil prices with an October announcement that it would , only to see prices fall below $80 per barrel by December.
Asked if Russia consulted about Moscow's new production cut, Kremlin spokesman Dmitry Peskov said 鈥渢here had been conversations with some members of the OPEC+鈥� before the move was announced. He didn鈥檛 offer any details.
But Novak insisted in a statement later that Moscow made the move without consulting anyone.
鈥淚t鈥檚 a voluntary cut; there have been no consultations with anyone regarding it,鈥� the deputy prime minister said, according to the Russian media.
The new reduction could be 鈥渁n early sign that Russia might try to weaponize oil supplies after last year's failed attempt to weaponize natural gas,鈥� said Simone Tagliapietra, an energy policy expert at the Bruegel think tank in Brussels.
But that could be difficult to accomplish because it's easier to find alternative supplies of oil, traded through tankers that crisscross the globe, than to replace natural gas, which before the war mostly came by pipeline.
Russian exporter Gazprom has , citing technical issues and refusal by some customers to pay in Russian currency. European officials call it retaliation for supporting Ukraine.
but has managed to replace much of the lost Russian supply from other sources including shipborne liquefied gas from the U.S. and Qatar. from all-time highs last summer but are still three times higher than before Russia massed troops on the Ukraine border.
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McHugh reported from Frankfurt, Germany.
David Mchugh And Vladimir Isachenkov, The Associated Press
