RIYADH: Saudi Arabia has decided to extend the voluntary oil output cut of 1 million barrels per day through September, reported the state-run news agency quoting an official from the Kingdom’s Ministry of Energy.
According to the Saudi Press Agency, the Kingdom’s production for September will be around 9 million bpd with this decision.
The SPA report added that this cut is in addition to the voluntary reduction previously announced by the Kingdom in April 2023, which extends until the end of December 2024.
During its last policy meeting in June, the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, had agreed on a deal to limit supply into 2024. Saudi Arabia then pledged a voluntary production cut for July, which the Kingdom later extended until August.
The report of the Kingdom’s decision to extend the output cut through September came just hours before the OPEC+ meeting scheduled for Friday.
OPEC+ pumps about 40 percent of the world’s crude and has cut its output target by 3.66 million bpd, amounting to 3.6 percent of global demand.
In June, Saudi Energy Minister Prince Abdulaziz bin Salman stressed the need to trust OPEC+ and called it the most effective international organization working to restore market stability.
“It was just our sensibility, if you will call it, that the environment was not sufficiently allowing confidence to be there. So, taking a precautionary measure tends to put you on the safe side. And it is part of the typical rhythm that we have installed in OPEC, which is being proactive, being preemptive,” Prince Abdulaziz told CNBC.
In July, the UAE’s Minister of Energy and Infrastructure Suhail bin Mohammed Al Mazrouei echoed similar views and said that OPEC+ always strives for oil market stability by ensuring a balance in fundamentals between supply and demand.
In a statement to the UAE news agency WAM, he said that OPEC’s technical team is constantly monitoring global oil market variables and presenting its recommendations to the ministerial committee to make appropriate decisions.