Riyadh: Russia, Saudi Arabia and several other OPEC+ members announced extensions to oil production cuts first announced in 2023 as part of an agreement among oil producers to boost prices following economic uncertainty.

Plan to extend cuts to mid-2024 comes on top of previous cuts to both oil output and exports as some of world’s largest energy producers drive to push up market rates.

Saudi Arabia’s Energy Ministry said it would cut its production by one million barrels per day (bpd) from April to June (Q2), while Russia announced 471,000 bpd of cuts in Q2.

“In order to maintain market stability, these additional cuts will be gradually restored depending on market conditions,” after end of second quarter, said Russia’s Deputy Prime Minister Alexander Novak.

UAE, Kuwait, Iraq and Kazakhstan followed suit, saying they would extend existing voluntarily cuts till end of June. OPEC+ oil alliance of 22 nations has implemented supply cuts of more than five million barrels per day (bpd) since end of 2022. Measures for Russia and KSA are in addition to 500,000 bpd reduction announced in April 2023, which runs until end of 2024.

West has tried to target Moscow’s energy exports under sanctions imposed over the Kremlin’s offensive in Ukraine, forcing Russia to ramp up supplies to countries like China and India. Oil prices surged in anticipation of new extension. US West Texas Intermediate (WTI) passed $ 80 for first time since November while North Sea Brent Crude Barrel hit month-high $ 83.55.

Published in The Daily National Courier, March, 04 2024

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