The Organization of Petroleum Exporting Countries (OPEC) has agreed to cut daily oil production by 1.2 million barrels starting from January, 2017.
At the 171st ordinary meeting yesterday in Vienna, the ministers of the OPEC have agreed to adopt the Algiers Accord. Saudi Arabia has agreed to have the largest share with 486,000 barrels of oil cut per day, while Nigeria and Libya remained the only two members exempted.
Briefing the media after the meeting, Dr. Mohammed Bin Saleh Al-Sada, Qatar’s Minister of Energy and Industry and President of the OPEC Conference, said the meeting decided to implement a new OPEC-14 production target of 32.5mbarrels daily in order to accelerate the ongoing drawdown of the stock overhang and bring the oil market rebalancing forward.
Iran has also joined the plan to cut 90,000b/d, which end the contention on the agreement, while Indonesia has suspended its membership from the group after rejecting the cut deal.
Al-Sada said the non-OPEC members have also agreed to reduce production by 600,000 b/d with Russia taking the largest cut of 300,000 alone.
Earlier yesterday, oil jumped more than 5 percent to about $50 per barrel, the biggest one-day jump since April, on the suspicion of the deal.
Al-Sada said the conference studied the Secretary General’s report, the report and recommendations made by the High-Level Committee that was set up following the ‘Algiers Accord’ that was agreed at the 170th (Extraordinary) Meeting of the OPEC Conference on September 28 in Algeria, the report of the Economic Commission Board, OPEC’s Long-Term Strategy (LTS) document, as well as various administrative matters.
