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My baseline assumption is that Russia will cheat on its promises to cut oil production whenever and wherever it can. The country is crushed between the need for more oil revenue to finance the war in Ukraine and falling oil prices. The one way out of that dilemma is to increase production, refinery volumes, and exports when it can.

“When it can” looks like Right Now. Russia’s oil refineries have reached the end of seasonal maintenance and crude-processing volumes have risen to the highest levels in nine weeks. Russia’s refining facilities processed 5.49 million barrels a day in the week ending June 14, Bloomberg reports. That’s nearly 194,000 barrels a day more than the week before and the country’s highest processing rate since the second half of April.

Crude supplies to domestic refineries, along with seaborne exports, remain the key gauges for anyone seeking clues to Russia’s production levels after the government classified output data amid Western sanctions. The country pledged to cut output by 500,000 barrels a day starting in March.

Russia is implementing its cuts in full, Deputy Prime Minister Alexander Novak has said repeatedly. But repetition doesn’t make it true.

With increased Russian exports making up for recent unilateral production cuts by Saudi Arabia, we’re looking at more oil on a market that is already worried about excess supply in the face of a slowing global economy.

I’m holding onto oil stocks that pay big dividends such as Pioneer Natural Resources (PXD), at 11.22%, and Devon Energy (DVN), at 9.06%, but I lightening up on my oil exposure by selling ConocoPhillips (COP) out of my Jubak Picks Portfolio. The stock pays a dividend of just 2.29%.

The position is up 26.8% as of June 20 since I started it on January 2, 2022.