Russian Deputy Prime Minister Alexander Novak pointed out on Friday that the risk of a reduction in oil production in Russia due to a price cap on Russian raw materials introduced by the EU and G7 countries still persists, and the Russian government will assess it in the near future. 

Novak said in late December that Russia is ready to cut oil production by 5-7% in early 2023 as a response measure to the price cap imposed by the West on Russian crude oil.

"Yes, there are such risks. We will be evaluating them soon," Novak told reporters when asked if there are any prerequisites for a reduction in oil production now.

Another package of sanctions against Russian oil went into effect earlier in February, with the EU agreeing on a $100 per barrel ceiling for Russian diesel fuel, and $45 per barrel for discounted products such as fuel oil.

Read more: Russia's oil, condensate production in 2022 up by 2.1% y/y to 534Mt

Russia to voluntarily reduce oil production by 500,000 bpd in March

In the same context, Novak indicated that Russia will voluntarily reduce oil production by 500,000 barrels per day (bpd) in March in order to contribute to the restoration of market relations.

"Russia will voluntarily cut production by 500,000 barrels per day in March. This will contribute to the restoration of market relations. When making further decisions, we will make decisions based on the current market situation," the Russian diplomat told a briefing.

Novak affirmed that Russia is selling all of its oil but will not sell it to those who directly or indirectly support the price cap.

Read more: Oil sanctions are a fail for the West, a win for Russia: The Economist