Inspenet, December 9, 2023.
Six OPEC+ member countries have agreed to make voluntary cuts in oil production, totaling 700,000 barrels per day during the first quarter of next year. At the same time, Saudi Arabia has announced the extension of its current reduction of 1 million barrels per day over the same period.
About the OPEC+ cut
These voluntary decreases have been calculated based on the production objectives established by each country for the year 2024, which were set in June. These actions are in addition to the voluntary cuts previously announced in April. In this latest agreement, the voluntary oil cuts include a decrease in 223,000 barrels per day from Iraq, 163,000 barrels per day from the United Arab Emirates, 135,000 barrels per day from Kuwait, 82,000 barrels per day from Kazakhstan, 51,000 barrels per day from Algeria and 42,000 barrels per day from Oman, according to the OPEC Secretariat.
Additionally, it was reported that Russia intends to reduce its oil exports by 500,000 barrels per day during the first quarter of next year, compared to the levels recorded in May-June 2023.
This cut represents an increase over the current cut of 300,000 barrels per day, although it includes a portion of 200,000 barrels per day corresponding to refined products. On the other hand, Saudi Arabia, which has played a significant role in OPEC+ production cuts over the last year, has agreed to extend for three months the 1 million barrels per day reduction it announced in June and began implementing. in July.
” In order to support market stability, these voluntary cuts will be gradually returned based on market conditions ,” OPEC stated.
The choice to implement more significant reductions is based on the decline in oil prices in recent weeks. Ice Brent crude oil futures peaked for 2023 at $96.55 per barrel in late September, but fell to $77.42 per barrel in mid-November. Currently, the price of Brent is around $83 per barrel at 17:55 GMT, approximately the opening level today.
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