The Organization of the Petroleum Exporting Countries (OPEC) and OPEC + (OPEC +), an advisory body of major oil producing countries such as Russia, agreed to cut crude oil production by 2 million barrels per day on the 5th.
OPEC Plus held a meeting in Vienna, Austria that day and made this decision. This is the largest production cut since 2020.
OPEC Plus member countries, including Saudi Arabia, said the decision to cut production was to prevent volatility in oil prices.
UAE Energy Minister Suhail Majruai said the decision is “technical, not political”.
Citing an analysis by Citi Bank, Reuters reported that “a significant cut in oil prices would spur the Biden administration ahead of the US mid-term elections if prices were to rise.”
It also predicted that the Biden administration would take action in response to the decision, such as the release by the United States of additional strategic oil reserves (SPRs) or stepping up the promotion of “NOPEC,” an antitrust law for OPEC. .
In the midst of this, Bloomberg News analyzed that the actual production cut would not be large as some OPEC + member countries are already producing below their quota.
Previously, Opec Plus cut production 3.6 million barrels per day less than its August target.
Meanwhile, Brent crude rose to $ 93 a barrel on the day.
VOA News
* This article referred to Reuters.
