• Thursday, March 28, 2024
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OPEC, Russia agrees to extend record oil cuts, push for compliance

OPEC-oil cuts

The Organisation of Petroleum Exporting Countries (OPEC) and its allies members led by Russia has agreed on a one-month extension of record output cuts, intended to further support the oil-price recovery.

In an online meeting on Saturday, the group agree to  maintain its production cut of 9.7 million barrels a day to the end of July, instead of easing it to 7.7 million after this month as planned.

 OPEC+ sources have said Riyadh and Moscow agreed to extend existing cuts throughout July, although Riyadh was seeking a further extension to August and possibly even December.

The alliance known as OPEC+ previously agreed to cut supply by a record 9.7 million barrels per day (bpd) during May-June to prop up prices that collapsed due to the coronavirus crisis.

In addition, nations including Iraq and Nigeria have promised to fully implement their production curbs and make extra reductions from July to September to compensate for failing to hit their targets in May and June, the delegates said.

The deal is a victory for Saudi Arabia and Russia, who spent a week cajoling fellow members to stop shirking their obligations.

Oil posted a sixth weekly gain in London, more than doubling to $42.30 a barrel since April as traders anticipate tighter supplies as demand recovers from the coronavirus lockdowns.

U.S. President Donald Trump on Friday hailed the cuts from the Organization of Petroleum Exporting Countries and its allies for saving the American energy industry.