OPEC + pledges to cut oil production by two million barrels per day

OPEC + members agreed at the end of their meeting today Wednesday to cut production by two million barrels per day in November, according to the group’s statement.

The OPEC + communiqué also stated that the “declaration of cooperation” would be extended until the end of 2023, with ministerial meetings to be held every 6 months.

The OPEC + ministerial monitoring committee will meet every two months to follow market developments.

Under the deal, Saudi Arabia’s production quota will drop to 10.48 million barrels per day in November.

And the Reuters news agency cited 3 OPEC + sources that the coalition countries agreed, at today’s meeting, to reduce their production by two million barrels a day, despite pressure from the United States and other consumer countries to pump more.

Two OPEC + sources have said that the agreed reduction from the blockade will take effect in November, while it has been decided that the next OPEC + meeting will be in December.

They could result in OPEC + production cuts Recovery of the price of oil Which dropped to about $ 90 from $ 120 three months ago due to fears of a global economic recession, rising US interest rates, and rising dollar.

And sources said, it is still unclear whether the cuts could include further voluntary cuts by members or if they could include the group’s current production shortage.

OPEC production is currently 3 million barrels per day below its target, and the inclusion of those barrels will mitigate the impact of the new cuts.

In the first American reaction, White House spokesman John Kirby said: “We need to be less dependent on oil from OPEC + countries and the rest of the producers.”

“If oil prices rise due to massive production cuts, it is likely to irritate the administration of US President Joe Biden ahead of the midterm elections in the US,” Citi analysts said in a statement.

“There may be more political backlashes from the US, including further releases of strategic actions,” they added, referring to a US anti-OPEC law.

Brent crude, the global benchmark, rose 3% on Tuesday, topping $ 91 a barrel, as it gained today on news of production cuts.