Saudi Arabia Deepens Oil Output Cuts in Effort to Prop Up Market
Bloomberg
Published May 11, 2020 08:11AM ET
Updated May 11, 2020 08:45AM ET
Saudi Arabia Deepens Oil Output Cuts in Effort to Prop Up Market
(Bloomberg) -- Saudi Arabia announced a voluntary and unilateral cut of 1 million barrels a day in its oil production, bringing output to its lowest in 18 years, as the kingdom tries to prop up a nascent recovery in global energy markets.
Saudi Arabia aims to pump in June just under 7.5 million barrels a day, compared with an official target under the most recent OPEC+ agreement of 8.5 million barrels a day. If Riyadh makes good on its pledge, production will drop to the lowest since mid-2002, according to Bloomberg data.
“The Kingdom aims through this additional cut to encourage OPEC+ participants, as well as other producing countries, to comply with the production cuts they have committed to, and to provide additional voluntary cuts, in an effort to support the stability of global oil markets,” an official at the Saudi Ministry of Energy said.
Riyadh also asked state-owned Saudi Aramco (SE:2222) to reduce its production in the current month of May “in consent with its customers”.
Oil futures rose on the news.
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