Opec and partners agree to 500000 barrel per day production cut

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Prices have fluctuated throughout the year, reaching almost $75 in April after USA sanctions on Iran and Venezuela limited world supply, but lingering trade tensions between the US and China dampened economic expectations pushed prices back down. -China trade war. OPEC+ stopped short of pledging action beyond the first quarter of 2020, causing analysts and traders to question the impact of the latest curbs.

"We have made a decision to reduce production by 500,000 barrels a day through the first quarter of next year, " said Russian energy minister Alexander Novak, after long discussions at OPEC headquarters in Vienna. Combined with geopolitical instability in Venezuela and Libya, tensions in the Middle East and United States sanctions on Iran, the production cuts have reduced the supply of oil and been positive for the price of the commodity.

A panel of ministers representing OPEC and non-OPEC producers led by Russia recommended the cuts, according to Russian Energy Minister Alexander Novak on Thursday. This is highly unlikely, however, the market is up nine weeks from its last main...

OPEC sources have also said Riyadh was pressing fellow members Iraq and Nigeria to improve their compliance with quotas, which could provide an additional reduction of up to 400,000 bpd. Brent, the worldwide benchmark, jumped 86 cents to US$64.25 a barrel.

The statement said that Opec and its partners in the so-called Opec+ grouping would convene for a special meeting on March 6. Condensate is counted against production totals for non-OPEC members but not for members.

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Existing supply curbs of 1.2 million barrels per day, aimed at supporting oil prices and preventing a global glut, are set to expire in March.

Saudi Arabia needs higher oil prices to support its budget revenue and the pending share sale of state-owned oil giant Saudi Aramco with pricing of its initial public offering (IPO) expected on Thursday.

Oil prices surged on Wednesday on expectations of deeper OPEC cuts and data showing a large drop in USA crude inventories last week.

That is something that the alliance has struggled to achieve throughout the three years of its existence, with some countries such as Iraq actually increasing output after promising to cut.

At the same time, Saudi Arabia's energy minister did not diclose the details of the deal reached at the meeting on Thursday, saying that it should be first discussed at the OPEC+ meeting on Friday, TASS informs.