Russia says it may reduce daily oil output by 700,000 barrels

Bloomberg

Russia may reduce its oil output by 500,000-700,000 barrels a day in early 2023 in response to the Group of Seven’s price cap on the nation’s crude exports, according to Deputy Prime Minister Alexander Novak.
“We are ready to partially cut our production early next year,” he said in an interview with Rossiya-24 TV channel, adding the volumes equate to roughly 5%-6% of what Russia’s now pumping.
“We’ll try to find some common ground with our counterparts to prevent such risks,” Novak said. “But right now we’d rather take a risk of a production cut than stick to the policy of selling in line with the threshold.”
While he described the potential output declines as “insignificant,” a cut of that size could still tighten the global oil market at a time when many analysts predict demand in China will be rebounding.
Novak reiterated that Russia will not sell its crude to buyers and nations that use the western price cap. Russian producers are able to reroute their exports to competing markets, including Asia, as the nation’s energy is still in high demand globally, he said.
President Vladimir Putin told reporters he will sign a decree on the nation’s response to the cap on Monday or Tuesday.
It will feature “preventive measures,” he said, without elaborating.
Russia’s full-year oil production this year will probably grow to 535 million tons, according to Novak. That’s equivalent to around 10.74 million barrels per day, based on a 7.33 barrel-per-ton ratio. Russia’s average daily output in November reached an eight-month high of 10.9 million barrels, according to industry data seen by Bloomberg.