Saudi Arabia & Other Countries Announce Surprise Oil Output Cuts
OPEC+ Production Cuts
The de facto leader of OPEC announced on Sunday a surprise voluntary slash of its oil output by 500,000 barrels/day, from May until the end of 2023. This was a coordinated move along with other OPEC and non-OPEC cooperating countries.
Here are the output cuts announced yesterday, in barrels per day (bpd), bringing the combined reduction to 1,149,000 barrels/day:
Saudi Arabia: 500,000 bbd [1]
Republic of Iraq: 211,000 bpd [2]
United Arab Emirates: 144,000 bpd [3]
Kuwait: 128,000 bpd [4]
Kazakhstan: 78,000 bpd [5]
Algeria: 48,000 bpd [6]
Oman: 40,000 bpd [7]
Russia meanwhile had recently announced the extension by a few months of its 500,000 barrels per day production cut plan. Yesterday PM Novak said this plan will stretch to the end of 2023, in line with the above countries, according to TASS. [8]
Sunday's announced slashes are in addition to the existing 2 million bpd cuts agreed by OPEC and non-OPEC Participating Countries back in October 2023 [9]. As such, the planned reduction from May until the end of the year is in excess of 3.5 million barrels/day.
USOIL Reaction
The commodity had slumped to 2023 lows in mid-March as the banking rout form unfolded and fears of recession creeped in. However, concerns around the health of the financial system seem to have eased and the Fed moved to a more conservative stance, helping USOil to a two-week rebound.
After Saudi Arabia and countries announced on Sunday that they will be slashing their oil output, USOil jumped to the highest level since January.
Nikos Tzabouras
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.
With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.
References
| Retrieved 03 Apr 2023 https://www.spa.gov.sa/viewfullstory.php | |
| Retrieved 03 Apr 2023 https://ina.iq/eng/25782-iraq-decides-to-voluntarily-reduce-production-by-211-thousand-bpd.html | |
| Retrieved 03 Apr 2023 https://wam.ae/en/details/1395303144358 | |
| Retrieved 03 Apr 2023 https://www.kuna.net.kw/ArticleDetails.aspx | |
| Retrieved 03 Apr 2023 https://www.gov.kz/memleket/entities/energo/press/news/details/530411 | |
| Retrieved 03 Apr 2023 https://www.aps.dz/en/economy/47187-opec-algeria-to-voluntarily-reduce-its-quota-by-48-000-barrels-day-from-may | |
| Retrieved 03 Apr 2023 https://omannews.gov.om/topics/en/80/show/112359/ona | |
| Retrieved 03 Apr 2023 https://tass.com/old-economy/1598195 | |
| Retrieved 27 Sep 2023 https://www.opec.org/opec_web/en/press_room/7021.htm |
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