Reuters: MOSCOW Vladimir Putin, the president of Russia, stated on Wednesday that oil production restrictions were necessary to maintain a specific price level. This contradicted claim made by other OPEC+ group countries’ leaders. Their organization was not attempting to manipulate the market in this way.
Russia has been accused by the United States and Europe of turning energy into a weapon. It is seen as an effort to restrict the West and undermine Moscow’s military operation in Ukraine.
In response to Russia sending soldiers into Ukraine in February 2022, Moscow accuses the West of turning the dollar and banking networks like the SWIFT international payments system into weapons.
What did Putin say?
Putin stated that the situation on the global oil market was, overall, “absolutely stable” at a live-streamed government meeting
Putin claimed the situation on the international oil market was, overall, “absolutely stable”. Russia continues to reduce output to support prices.
He added that Russia has been decreasing its production, which was at the “required level”.
All of our measures are aimed at maintaining a specific price level in global markets. This includes voluntary production cuts. We coordinate and communicate with our allies in OPEC+ to achieve this goal.
OPEC
Large fuel consumers like the United States have accused the OPEC of setting a target price for oil. But Saudi Arabia, the group’s dominant member, and other OPEC countries have consistently stated that they are not doing so.
At the same time, some watchers of OPEC claimed that the group required higher oil prices because of the acceleration of inflation comparison to February levels. Russia announced on April 2 that it would continue to reduce its oil production. It will be by 500,000 barrels per day (bpd), or nearly 5% of its total output, through the end of the year. On the same day, prominent OPEC members announced cuts.
Although we are cutting production, it is still at the necessary level, according to Putin.
Russian Deputy Prime Minister Alexander Novak announced that his country has met its goal of reducing its oil production by 500,000 bpd this month while on a visit to Iran.
The longest series of weekly decreases since September 2022 occurred last week. It was when oil pricing benchmarks declined for a fourth straight week.
Early in June, there were concerns about a possible U.S. recession and a historic federal debt default.
According to calculations by Reuters, the price of the Russian Urals trademark oil mix, in roubles, dropped in early May by 14% below the breakeven threshold projected for this year’s federal budget. This increased the already significant gap in the public coffers.