Russia’s oil revenues plummet as West’s value ceiling begins to chunk

Russia introduced it could lower oil manufacturing by 500,000 barrels a day in March after the West imposed value caps on Russian oil and petroleum merchandise.

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The Worldwide Vitality Company stated Wednesday that Russia’s oil export earnings fell sharply in February, resulting from bans and value caps aimed toward limiting President Vladimir Putin’s skill to finance the warfare in ukraine.

The IEA stated estimated income from Russia’s oil exports fell to $11.6 billion final month, down $2.7 billion from January, when volumes had been considerably larger. .

“It stays to be seen whether or not there will likely be ample urge for food for Russian petroleum merchandise now that the worth cap is in place or whether or not its manufacturing will begin to fall underneath the load of the sanctions. Revenues are already falling,” the group stated. in his newest assertion. oil market report.

The power company stated, citing the Russian Finance Ministry, that Moscow’s tax income from oil gross sales was solely 45% of the earlier 12 months’s stage.

The most recent figures come shortly after the IEA stated in mid-February that the West’s oil warfare in opposition to Russia appeared to have “desired impact“regardless of surprisingly resilient manufacturing and exports in current months.

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Ukrainian officers and activists have beforehand referred to as on Western policymakers to extend monetary strain on Russia by concentrating on its oil revenues to assist kyiv win.

The European Union embargo on Russian petroleum merchandise got here into drive on February 5, constructing on the $60 oil value cap put in place by the key Group of Seven economies on December 5. This newest transfer additionally coincided with a call by the EU and UK to ban the import of Russian crude oil by sea.

Requested on Tuesday whether or not he feared Russia’s economic system collapsed final 12 months resulting from worldwide sanctions, Putin stated he was involved however that Russia’s “financial sovereignty” was now a serious consequence. The foundations of Russia’s financial stability had been “stronger than beforehand thought”, he added.

Putin stated Russia’s monetary system had strengthened and Western firms that left Russia final 12 months thought the economic system would collapse “however it hasn’t.”

OPEC more concerned about stability of supply than seasonality of oil prices, consultancy says

– CNBC’s Holly Ellyatt contributed to this report.