Earlier this week, we reported that oil recent jumped to the highest price since last October, thanks to two things: the unexpected slump in US oil production (which one woudn't know if listening to the manipulated data from BIden's Dept of Energy, yet which even the Dallas Fed highlighted in its latest Energy Survey), and also the report that Russia government has surprisingly ordered companies to reduce oil output in the second quarter.
The news caught many by surprise because while the stated reason was to ensure Moscow met a production target of 9 million barrels per day (bpd) by the end of June in line with its pledges to OPEC+, Russia has never before made a big stink about cheating on its OPEC+ promises, until now. Why? Because as we explained earlier this week, "suddenly every incremental dollar in oil costs means Biden's approval rating drops by (at least) 1%." And just as Biden can - and has - weaponized the dollar, so Putin has done the same with oil.
Overnight, JPM noticed the same odd twist, and in a note from the bank's commodity expert Natasha Kaneva she wrote that "In contrast to her expectations" Russia instead pledged in early March to deepen its output cut by a cumulative 471 kbd, bringing the country’s crude oil output to 9.0 mbd in June. She goes on to note that "at the time of the announcement, we found Russia’s commitment to be genuine, a view validated on Monday by a Reuters report that the Russian government has ordered companies to reduce oil output in the second quarter to ensure they meet a production target of 9 mbd by the end of June, in line with its pledges to the OPEC alliance."
