2024-03-03 15:33:00
(Updated with sources, details, context)
The Organization of the Petroleum Exporting Countries (OPEC) and their allies, united within OPEC+, have agreed to extend the current agreement to reduce crude production until the end of the second quarter in order to avoid an oversupply, sources said on Sunday.
In November, OPEC+ agreed to voluntary reductions totaling around 2.2 million barrels per day (bpd) for the first quarter, led by Saudi Arabia which renewed its own voluntary reduction.
OPEC+ has implemented a series of production cuts since late 2022 to support the market in the face of increased production from the United States and other non-member producers and concerns regarding demand as major economies are facing high interest rates.
Oil prices remained supported due to growing geopolitical tensions linked to attacks by Yemen’s Houthis in the Red Sea, despite concerns over economic growth and high interest rates.
Brent LCOc1 futures for May settled at $83.55 a barrel on Friday, up $1.64, or 2%.
Sources told Reuters last week that OPEC+ would consider extending oil production cuts into the second quarter, with one saying it was a “likely” possibility. .
OPEC+ member countries announce their reductions individually. Kuwait said it would cut oil production by 135,000 bpd until June, and Algeria by 51,000 bpd.
(Reporting by Maha El Dahan and Alex Lawler, edited by Yousef Saba; French version by Claude Chendjou and Kate Entringer)
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