More join Saudi oil cut
The Canadian Press – Apr 2, 2023 / 1:12 p.m | Stories: 419210
Photo: The Canadian Press
Several major oil producing countries have joined Saudi Arabia in announcing surprise production cuts that could send world oil prices higher.
Saudi Arabia said Sunday it was cutting production by 500,000 barrels per day from May until the end of the year. That represents less than 5% of its average production in 2020.
The United Arab Emirates, Oman, Iraq, Kuwait, Algeria and Kazakhstan all announced similar but smaller reductions, for a total of 1.15 million barrels per day.
Saudi Arabia says it will cut oil production by 500,000 barrels per day from May until the end of 2023.
The move would likely raise oil prices, further straining relations between Riyadh and Washington as the world copes with inflation fueled in part by the war in Ukraine.
The Energy Ministry said Sunday that the cuts would be made in coordination with some OPEC and non-OPEC members, without naming them, and were in addition to a reduction announced last October.
It described the move as a “precautionary measure” aimed at stabilizing the oil market.
Saudi Arabia angered the Biden administration last year when it and other OPEC members agreed to cut production on the eve of US midterm elections in which inflation was a major issue. Both the US and Saudi Arabia denied any political motives, saying they were focused on maintaining a healthy market price.