Moscow warns it may cut production by 5-7 percent in early 2023 as the energy war with the West deepens.

Russia may cut oil output by 5-7 percent in early 2023 and halt sales to countries supporting a price cap on its crude and oil products, a senior official has said.

Deputy Prime Minister Alexander Novak told state television on Friday that the cuts could amount to 500,000-700,000 barrels per day.

His remarks marked the first in-detail Russian response to the recent price caps rolled out on Russian energy exports by Ukraine’s Western allies over Moscow’s invasion of its neighbour.

The European Union, G7 countries and Australia introduced a $60 per barrel price ceiling on Russian oil from December 5

on top of the EU’s embargo on imports of Russian crude by sea and similar pledges by the United States, Canada, Japan and the United Kingdom. The EU has also introduced restrictions on gas prices.

These moves are aimed at restricting Russia’s revenue streams while making sure much-needed energy exports do not come to a standstill.