RFE
07 Dec 2019, 16:15 GMT+10
The OPEC cartel and its partners, including Russia, say they have agreed to cut oil production further as part of efforts to boost prices, as global supplies rise amid a global economic slowdown.
However, some doubts remain about the long-term effectiveness of the cuts agreed by the so-called OPEC+ group on December 6, with other nations not linked to the group -- including the United States -- continuing to pump oil products to the marketplace.
Russian Energy Minister Aleksandr Novak said from Vienna after the OPEC+ meeting that "we have decided to reduce production by 500,000 barrels a day through the first quarter of next year."
Those cuts will come on top of a reduction of 1.2 million barrels a day that the group has been mostly observing the past three years.
The reach the accord, the nations had to overcome disagreement over how to share the cuts among the 14 OPEC countries and non-cartel members, such as Russia, the world's second-largest oil producer.
Saudi Arabia has been carrying out the largest share of production cuts, but Russia and others, including economically ailing Iraq and Nigeria, have been pumping more than expected and reducing the impact on the overall market.
Despite some skepticism over whether all nations will comply with the cuts, oil prices did jump on the marketplace.
The price of oil had gained in recent days on expectations for the output cut, but after the announcement, the benchmark Brent crude price jumped 86 cents to $64.25 a barrel.
The new accord sets the output target at 1.7 million barrels a day lower than the level of October 2018.
Between them, Saudi Arabia and Russia will make nearly half the additional reductions.
Iraqi Oil Minister Thamer Ghadban told reporters that 'what will happen during the first quarter [of 2020] will be assessed during an extraordinary meeting' of OPEC and its partners in early March.
He suggested the cuts could be extended until the end of 2020 but that it was 'too early to say now'.
Countries not in the OPEC+ grouping were not part of the deal, and increased output from those nations could weaken the impact of the output cuts.
Oil production in the United States -- now the world's biggest producer in 2018 -- Brazil, and Canada are at record levels, while Norway plans to increase its production as well.
With reporting by AP, AFP, and TASS
Copyright (c) 2018. RFE/RL, Inc. Republished with the permission of Radio Free Europe/Radio Liberty, 1201 Connecticut Ave NW, Ste 400, Washington DC 20036
Get a daily dose of Chile Sun news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Chile Sun.
More InformationBRUSSELS - Venezuela's Juan Guaido is a "privileged interlocutor" but no longer considered interim president, European Union states said in ...
Buenos Aires [Argentina], January 25 (ANI): Indian women's hockey team went down fighting against a dominant Argentina 'B' outfit in ...
Washington [US], January 25 (ANI): A group of researchers is asking governments to consider the continued practice of strict COVID-19 ...
BUENOS AIRES, ARGENTINA - Argentina's groundbreaking abortion law went into force Sunday under the watchful eyes of women's groups and ...
Brasilia [Brazil], January 25 (ANI/Sputnik): Five people, including four footballers, died after their light aircraft crashed to the ground in ...
The world is on the verge of reaching 100 million COVID-19 infections, according to Johns Hopkins Coronavirus Resource Center statistics. ...
By Reena BhardwajWashington [US], January 25 (ANI): Champ and Major, the pair of German Shepherds of President Joe Biden and ...
Lucca [Italy], January 25 (ANI): A new study shows that posts revealing concern for 'pneumonia' circulated very early, suggesting social ...
Editor's note: The Jan. 6 attack on the U.S. Capitol represented an event unlike any other in American history. But ...
Karachi [Pakistan], January 25 (ANI): Pakistan skipper Babar Azam on Monday said that he is not a fan of on-field ...
BRUSSELS - Venezuela's Juan Guaido is a "privileged interlocutor" but no longer considered interim president, European Union states said in ...
Washington [US], January 25 (ANI): Researchers during a recent study have found that a nuclear war could trigger an unprecedented ...