Russia Slashes Oil Output Amid Ukraine Conflict
Russia's oil production has declined significantly in April due to Ukrainian drone attacks on ports and refineries, as well as a halt to crude supplies via the only remaining Russian oil pipeline to Europe. According to five sources and Reuters calculations, Russia may have cut production by about 300,000 to 400,000 barrels per day in April, from the average level seen in the first months of the year.
The decline is the sharpest monthly drop in Russian output since the COVID pandemic, which hit six years ago. Oil is the lifeblood of Russia's $3 trillion economy, and a decline in output cuts revenue for the world's second-largest exporter.
Russia's Finance Minister Anton Siluanov said that high prices would help reduce the budget deficit, potentially cushioning the losses from the production decline. However, the Paris-based International Energy Agency has revised down Russia's oil supply projection by 120,000 bpd for the remainder of the year due to persistent attacks on refineries and port infrastructure.