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Agencies

Riyadh on Sunday announced it would slash output further by 1.4 million barrels per day in a bid to prop up prices, despite fears of a recession.
The announcement on production cuts came following a meeting of the 13-member Organization of the Petroleum Exporting Countries (Opec) headed by Saudi Arabia and its 10 partners, led by Russia.
The cut is for July but “can be extended”, Saudi Energy Minister Prince Abdulaziz bin Salman told reporters.
It is a “voluntary” cut announced after the in-person, hours-long Opec+ meeting at the group’s headquarters in Vienna, Austria which saw some tough negotiations.
Buying more Russian fuel: why some of Asia not criticised as much as India
Oil prices jumped more than US$2 a barrel in early Asian trade on Monday, hours after Saudi Arabia’s pledge.
Brent crude futures was at US$78.42 a barrel, up US$2.29, or 3 per cent, at 10:19pm GMT after earlier hitting a session-high of US$78.73 a barrel.
US West Texas Intermediate crude climbed US$2.27 a barrel, up 3.2 per cent, or US$74.01 a barrel, after touching an intraday high of US$75.06 a barrel.
Analysts had largely expected Opec+ producers to maintain their current policy, but signs emerged this weekend that the 23 countries may make deeper cuts.
An output cut of one million barrels per day (bpd) was being discussed, according to the source close to the talks.

In April, several Opec+ members agreed to cut production voluntarily by more than one million bpd – a surprise move that briefly buttressed prices but failed to bring about lasting recovery.
Bloomberg news agency reported a fight with the grouping’s African members threatened to derail the gathering.
While the United Arab Emirates was pushing for a change to the way its output cuts are measured, African countries were reluctant to give up some of their unused quotas – a politically unpalatable option, it said, citing delegates.
Several Opec+ nations – including Angola and Nigeria, already seeming to be at maximum capacity – have struggled to meet their quotas.
Oil producers are grappling with falling prices and high market volatility amid the Russian invasion of Ukraine, which has upended economies worldwide.
Oil prices have plummeted about 10 per cent since the April cuts were announced, with Brent crude falling close to US$70 a barrel, a level it has not traded below since December 2021.


Traders worry that demand will slump, with concerns about the health of the global economy as the United States battles inflation and higher interest rates while China’s post-Covid-19 rebound stutters.
Russia’s Deputy Prime Minister Alexander Novak said the current output cuts were being extended until the end of 2024 after examining the matter “for a long time”.
Novak also said the market is more or less balanced, and demand is rising, although the group would monitor interest rate decisions by global central banks, including the US Federal Reserve, for clues on the economy that could influence fuel consumption.
“That’s the indicator (interest rate decisions), which is having an impact on investments, on demand for oil and oil products,” he said.

Novak also said Opec+ could adjust its decisions if necessary.
He said the data from secondary sources related to the Opec+ voluntary cuts starting from May will emerge in the middle of this month.
Russia is dependent on oil revenues with its war in Ukraine dragging on and Western sanctions hitting its economy.
Novak “sees no need for Opec+ to change course” because it would hardly benefit from higher prices, Commerzbank commodity analysts said in a research note ahead of the meeting.
Since Western sanctions hit Moscow over Ukraine, Russia has been shipping oil to India and China as the Asian giants soak up the cheap crude.
India, China ‘enjoy the discount’ on Russian oil as EU tightens price cap
Saudi Arabia, on the other hand, “does need higher prices to balance its budget”, Commerzbank analysts said, adding that the kingdom’s break-even price is currently “at a good US$80 per barrel”.
Despite the tensions, both of the top Opec+ producers “will no doubt be keen to keep the cartel together, as it has more power thanks to the united front it is showing”, they said.
In March 2020 the alliance was pushed to the brink of collapse when Moscow refused to cut oil production even as the Covid-19 pandemic sent prices into free fall.
After negotiations broke down, Riyadh flooded the market by boosting exports to record levels before the two countries came to an agreement.
Asked if there were disagreement with Saudi Arabia this weekend, Novak said “No, we had no disagreements, it is a common decision.”
Opec+ produce about 60 per cent of the world’s oil.


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Energy

Saudi Arabia to cut oil output by 1 million barrels per day to boost slumping prices

Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman al-Saud arrives for an OPEC+ meeting in Vienna, Austria on Sunday. Photo: Reuters

Deputy Prime Minister of Russia Alexander Novak in Vienna, Austria on Sunday. Photo: Reuters 

Police officers stand guard at the headquarters of the Organization of Petroleum Exporting Countries (Opec) in Vienna, Austria on Saturday. Photo: AFP

Asia set for both gain and pain as reopened China soaks up oil demand

Shanghai Yangshan Deepwater Port Container Cargo Terminal in Shanghai has become one of the world’s largest container port. Oil markets appear set for another period of turbulence as China’s air and road travel have roared back. Photo: Shutterstock

After a collapse last year, China’s demand is expected to account for about half of the global demand of 2 million barrels per day. Photo: Shutterstock

China, Saudi Arabia consolidate energy ties amid uncertainty over Russian supplies

Chinese President Xi Jinping goes to shake hands with Crown Prince Mohammed bin Salman, Saudi Arabia’s de facto ruler, upon arrival in Riyadh in December. Photo: Saudi Press Agency via AP

Engineers at work in a Saudi Aramco facility in eastern Saudi Arabia. The Panjin complex could import an estimated US$160 billion worth of Saudi crude over its lifespan. Photo: Saudi Aramco Handout via AFP

Oman looks to raise profile in Asia after helping Saudi Arabia and Iran bury the hatchet

Yemenis walk past historic buildings in Sanaa. A civil war has raged in Yemen since 2014. Photo: EPA-EFE

Oman’s ruler Haitham bin Tariq, on the throne since January 2020. His predecessor was in charge for half a century. Photo: via AP

Haitham Bin Tariq, centre, became Sultan of Oman in 2020. Photo: Instagram/@theyazin_alsaid 

China’s Foreign Minister Qin Gang with his Saudi Arabian and Iranian counterparts on April 6. China helped to broker a deal bringing the two nations together after the severing of diplomatic relations in 2016. Photo: Xinhua

Chinese President Xi, Japan PM Kishida’s trips to opposing capitals in Ukraine war spotlight Asian buyers of Russian oil

Two of the world’s largest consumers, India and China’s energy needs have come into sharp focus this week over their ties to Russia. Photo: Reuters/File

News

World

Middle East

Europe

Riyadh on Sunday announced it would slash output further by 1.4 million barrels per day in a bid to prop up prices, despite fears of a recession
Oil prices jumped more than US$2 a barrel in early Asian trade on Monday, hours after Saudi Arabia’s announcement


At an in-person Opec+ meeting at the group’s headquarters in Vienna on Sunday, Riyadh announced it would slash output further by one million barrels per day in a bid to prop up prices, despite fears of a recession.


Saudi Arabia to cut oil output by 1 million barrels per day to boost slumping prices

Riyadh on Sunday announced it would slash output further by 1.4 million barrels per day in a bid to prop up prices, despite fears of a recession Oil prices jumped more than US$2 a barrel in early Asian trade on Monday, hours after Saudi Arabia’s announcement

Riyadh on Sunday announced it would slash output further by 1.4 million barrels per day in a bid to prop up prices, despite fears of a recession

Oil prices jumped more than US$2 a barrel in early Asian trade on Monday, hours after Saudi Arabia’s announcement