MOSCOW, December 25. /TASS/. Russian Finance Minister Anton Siluanov has said Russia will prefer to cutting oil production over supplies under a Western price cap, the Asharq News television channel reported.

"What is the Russian Federation saying? We won’t supply oil under contracts that will indicate a price cap that’s proposed by Western countries. That’s ruled out. That’s what the Russian president said - that Russia won’t supply oil under deals that will indicate caps," he said.

"How will that impact the economy, the country’s budget, the production volume? Yes, it’s possible production volumes will need to be limited somewhere. But we are seeing now that our companies, our oil producing companies are rerouting their supplies from the west to the east, south, other countries. We are looking for new oil customers, and as demand for oil, according to forecasts by agencies, will rise, the situation will to a large extent depend on the performance of global economy. So, the demand for oil will rise. We will look for other markets, other logistics. That may be more expensive," the minister said.

On December 5, an embargo on maritime Russian oil shipments to the European Union came into force. Moreover, EU states also agreed on a price cap for Russian oil delivered by sea, setting the ceiling at $60 a barrel. A similar decision was announced by the G7 and Australia. The West is also banning its companies from providing transportation, financial and insurance services to tankers carrying oil from Russia at a price above the agreed-on ceiling.

Russia is readying a decree in response to these measures. Earlier, Deputy Prime Minister Alexander Novak said that Russia intended to create and launch a mechanism by the end of 2022 that would prohibit Russian companies from trading oil with countries complying with the price cap.

On December 22, the European Union officially approved a dynamic ceiling on gas prices at the level of Ђ180 per megawatt-hour (approximately Ђ1,850 per 1,000 cubic meters). The restriction will enter into force on February 15, 2023.