Russia will slash oil exports 25% to try and push up crude prices for the west, report says

• Russia will slash oil shipments from its western export hubs, according to Reuters.
• Three sources told Reuters that shipments are expected to be cut 20%-25% in effort to raise Russian crude prices.

Russia is planning to make hefty cuts to its crude exports in order to push oil prices up for the west, Reuters reported this week.

Three people in the Russian oil trade said the nation could slash shipments from its Western export hubs as much as 25% by March, Reuters originally reported on Wednesday. One source said the state-operated oil pipeline Transneft already told two businesses they would be given 20%-25% fewer shipments in March than it had originally requested from Russia's Western ports.

The export cut is expected to take even more supply away from Western oil customers, with Russia already planning to cut 5% of its oil production, or 500,000 barrels a day, starting in March.

"The export cuts appear to be deeper than the planned production cuts. It might help bump up the price for Russian oil," the source added.

The moves are in apparent retaliation to sanctions, particularly the European Union's ban and $60 price cap on Russian oil, which have severely crimped Moscow's war revenue since taking effect late last year.

Russia lost $15 million in the last week of 2022 alone as exports plunged to their lowest level of the year. Russia's Urals blend, its main crude product, is also trading well below the $60 price cap, as the nation has only been able to keep up oil trade with a handful of buyers.

Putin has rebuffed the sanctions as "stupid," and has vowed to simply ship more oil to allies like China and India, which have snapped up Russian crude at hefty discounts. Currently, there are no plans to slash shipments from Russia's Pacific export hubs, one of the sources told Reuters.

Russia has also outlined two other methods of potential retaliation in response to western sanctions, which are designed to spike prices for western customers. The nation also has the capacity to cut oil production up to five million barrels a day, JPMorgan warned, which could send crude prices hurtling towards $380 a barrel.