Oil jumps over 3 per cent after Russia signals output cut in retaliation to price cap



by SOURAV D

Oil jumps over 3 per cent after Russia signals output cut in retaliation to price cap

Following what could be contemplated as a bold act of retaliation from Kremlin to slash output after inclination of a $60 per barrel price cap on its sea-borne crude oil by the US and EU, both US WTI (West Texas Intermediate) alongside UK crude oil futures’ prices feathered up over 3 per cent on Friday.

After the day’s broad-based rally, oil prices secured a second straight week of gains, as Kremlin had hinted an output cut of nearly 5 million barrels per day or 5 per cent of entire global oil output. OPEC+ members alongside other oil producing nations supply a roughly 91 million barrels of oil per day as of last Friday.

In the matter of that, Citing the Russian Deputy Prime Minister Alexander Novak, Russia’s Ria News agency said earlier on Friday that the world’s second-largest exporter of crude oil after the Kingdom of Saudi Arabia, might downsize output by 5 per cent to 7 per cent earlier in 2023.

Meanwhile, adding that the retaliatory measure from Russia could have a significant impact on oil prices, a senior market strategist at RJO Futures, Eli Tesfaye said, “The potential cut from Russia could be giving the bulls more fuel.

If global demand continues at current pace, that cut could have a significant impact and we may stay in the $80s range”.

Oil gains on possibility of Russia output cut

Citing statistics, in the day’s commodity market wind-down, UK crude futures’ prices wrapped up the session 3.6 per cent higher to $83.92 a barrel, while US WTI crude oil contracts’ prices gained 2.7 per cent to $79.56 per barrel.

Over the week, UK crude oil futures’ prices jumped 6.73 per cent, while US WTI crude oil futures’ prices gained 6.61 per cent.

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