Saudi Arabia Says It Will Cut Production to Stem a Slide in Oil Prices
The group of major oil-producing countries known as OPEC Plus agreed on Sunday to embark on a complex effort to adjust production as it aimed to halt the recent slide in oil prices, including an additional cut in output of one million barrels a day by Saudi Arabia.
The Saudi cut would be for one month beginning in July, but could be extended.
The group, which includes Russia and its allies, was under pressure to produce a deal to reverse the pessimism that has dominated the oil market in recent weeks. Despite two substantial output cuts since October, the price of oil has drifted about 15 percent lower over the past seven months.
The agreement, the result of lengthy negotiations on Saturday and Sunday, reworks the output quotas of several countries, with the United Arab Emirates gaining and some others losing production levels. “This is definitely not a clean and simple deal,” said Richard Bronze, head of geopolitics at Energy Aspects, a research firm.
The agreement includes a voluntary cut of 500,000 barrels a day that Moscow announced in February.
Comments at the news conference after the meeting revealed skepticism that Russia was abiding by those lower production levels. High Russian production levels, and its increased share of Asian markets including India, often at the expense of Middle East oil producers, have become a sensitive issue in the group.
Source: The New York Times
