Oil producers under OPEC alliance to cut output by 1.16m from May

Saudi Arabia and other OPEC+ oil producers, on Sunday, unexpectedly announced additional cuts to oil production of over 1.16 million barrels per day. Analysts predicted an immediate increase in prices, and the US deemed the action unwise.

The pledges raise the overall amount of cutbacks by OPEC+, which includes Russia and other allies, to 3.66 million bpd, or 3.7 percent of global demand.

Russia’s deputy prime minister also said Moscow would extend a voluntary cut of 500,000 barrels a day until the end of 2023. The United Arab Emirates, Kuwait, Iraq, Oman and Algeria said they would voluntarily cut output over the same time period.

The UAE said it would cut production by 144,000 bpd, Kuwait announced a cut of 128,000 bpd while Iraq said it would cut output by 211,000 bpd and Oman announced a cut of 40,000 bpd. Algeria said it would cut its output by 48,000 bpd.

The Saudi energy ministry said in a statement that the kingdom’s voluntary cut was a precautionary measure aimed at supporting the stability of the oil market.

The event on Sunday occurs the day before a virtually convened meeting of an OPEC+ ministerial panel, which also includes Saudi Arabia and Russia, and which had been anticipated to maintain the 2 million bpd oil curbs already in place through the end of 2023.

Isaac Anyaogu

Isaac Anyaogu is an Assistant editor and head of the energy and environment desk. He is an award-winning journalist who has written hundreds of reports on Nigeria’s oil and gas industry, energy and environmental policies, regulation and climate change impacts in Africa. He was part of a journalist team that investigated lead acid pollution by an Indian recycler in Nigeria and won the international prize - Fetisov Journalism award in 2020. Mr Anyaogu joined BusinessDay in January 2016 as a multimedia content producer on the energy desk and rose to head the desk in October 2020 after several ground breaking stories and multiple award wining stories. His reporting covers start-ups, companies and markets, financing and regulatory policies in the power sector, oil and gas, renewable energy and environmental sectors He has covered the Niger Delta crises, and corruption in NIgeria’s petroleum product imports. He left the Audit and Consulting firm, OR&C Consultants in 2015 after three years to write for BusinessDay and his background working with financial statements, audit reports and tax consulting assignments significantly benefited his reporting. Mr Anyaogu studied mass communications and Media Studies and has attended several training programmes in Ghana, South Africa and the United States

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