Saudi Arabia will extend its voluntary cut of one million barrels per day, implemented in July 2023, until the end of the first quarter of 2024 in coordination with some OPEC+ participating countries, an official source from the Ministry of Energy said on Thursday.
With this, the Kingdom’s production will be approximately 9 million barrels per day until the end of March 2024. “To support market stability, these additional cut volumes will be returned gradually subject to market conditions,” state news agency Saudi Press Agency said.
The source also noted that this voluntary cut is in addition to the voluntary cut of 500 thousand barrels a day previously announced by the Kingdom in April 2023, which extends until the end of December 2024. The source confirmed that this additional voluntary cut reinforces the precautionary efforts made by OPEC+ countries to support the stability and balance of oil markets.
Oil prices declined after an initial surge following the decision by OPEC+ to implement production cuts. Benchmark Brent crude for February futures dipped 3%, trading below $81 a barrel by 1634 GMT. The front-month January contract is set to expire on Thursday.
OPEC+ prioritises lower output in response to a price drop from near $98 in late September. Concerns over sluggish economic growth in 2024 and anticipation of a supply surplus have also contributed to the recent price decline.
