Saudi Arabia extends 1 million bpd oil cut

RIYADH: Saudi Arabia will extent a voluntary oil output cut of one million barrels per day for another month to include September, it said on Thursday, adding it could be extended beyond that or deepened.

The kingdom’s production for September will be around 9 million barrels per day (bpd), the state news agency SPA cited an official source at the energy ministry as saying.

“This additional voluntary cut comes to reinforce the precautionary efforts made by OPEC+ countries with the aim of supporting the stability and balance of oil markets,” the source said.

The cut may be “extended, or extended and deepened”, he added, flagging the possibility of further market tightening.

Russia will also cut oil exports by 300,000 bpd in September, Deputy Prime Minister Alexander Novak said shortly after the Saudi announcement.

Read more: OPEC+ surprise output cuts lift oil prices by $5 per barrel

OPEC+ agreed on a broad deal to limit supply into 2024 at its last policy meeting in June, and Saudi Arabia pledged a voluntary production cut for July that it has since extended to include August.

A panel from OPEC+, which includes members the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, is meeting on Friday.

The Joint Ministerial Monitoring Committee is unlikely to tweak oil policy at its Friday meet, sources have said.

c+, which pumps around 40% of the world’s crude, has been limiting supply since late 2022 to support the market.

Oil rose on Thursday, rebounding from an earlier decline after the Saudi announcement, with Brent crude futures up 42 cents to $83.62 a barrel by 1328 GMT.

The Saudi voluntary cut announcement for July had come as a surprise at the June OPEC+ meeting in Vienna, where Riyadh shared little or no detail on the measure with other delegations prior to the announcement, OPEC+ sources have said.

Saudi Energy Minister Prince Abdulaziz bin Salman said in July that OPEC+ would “continue the effort at surprising markets” and do “whatever is necessary” to balance them.