Russian Deputy Prime Minister Alexander Novak has announced that starting from September, Russian oil producers will reduce exports of crude oil by 300,000 barrels per day (bpd) in what he said is a move designed to balance out the supply and demand on the global market. Russia is the world’s second largest oil producer behind Saudi Arabia.

This cut will be performed on top of the 500,000 bpd cut, representing nearly 5% of its output, which Russia already pledged to implement from March through the end of 2023.

In an interview with the TV channel Rossiya 24, Deputy Prime Minister Novak said, “As part of efforts to ensure the oil market remains balanced, Russia will continue to voluntarily reduce its oil supply in the month of September, this time by 300,000 bpd, reducing exports by that quantity to global markets.” 

The announcement comes on the heels of an announcement by Saudi Arabia that it would be extending its voluntary production cut for at least one more month through September, to support global crude oil prices. Riyadh noted it could extend the production cut, which will reduce output to about nine million bpd, beyond September, and it retained the right to deepen the cut if necessary.

OPEC+, made up of the Organization of the Petroleum Exporting Countries (OPEC) and its allied producers (including Russia), announced last October it would cut its member’s output by about 2% of world demand, beginning last November, and lasting until the end of 2023. The group and its members later pledged additional production cuts, as oil prices dropped.

Since early July, when Saudi Arabia and Russia announced additional significant production cuts, global oil prices have steadily gained, with Brent crude growing from $76 per barrel to over $85 at present.