The United Arab Emirates (UAE) and Saudi Arabia have jointly announced their decision to extend oil supply cuts until mid-2024, as part of a concerted effort to stabilize oil prices. This development coincides with Russia's revelation of plans to further reduce its oil output and exports, indicating a collective commitment among major oil-producing nations to address market dynamics.
The decision to extend oil output cuts stems from the collaborative efforts within the OPEC+ group, which includes prominent oil producers like Saudi Arabia, the UAE and Kuwait. These measures are aimed at achieving market balance and stability amidst evolving global economic conditions.
In a statement released by the OPEC secretariat, it was revealed that several OPEC+ members have agreed to extend additional voluntary cuts amounting to $2.2 million barrels per day until the end of the second quarter. These cuts are calculated based on the required production levels outlined in the OPEC ministerial meeting held in June 2023.
As the world's leading oil exporter and OPEC's largest producer, Saudi Arabia has pledged to extend its voluntary cut of $1 million bpd until the end of the second quarter of 2024. This decision signifies the kingdom's dedication to supporting market stability.
Similarly, the UAE has committed to extending its additional voluntary cut of $163,000 bpd for the second quarter of 2024. This brings the UAE's production to $2.912 million bpd until the end of June 2024, reinforcing the nation's commitment to collective efforts within OPEC+.
Russia has also announced its intention to reduce oil production and exports by an additional $471,000 bpd in the second quarter of 2024. This coordinated effort with OPEC+ countries reflects a shared goal of maintaining oil market stability.
The extension of oil supply cuts by the UAE, Saudi Arabia, and other OPEC+ members highlights the collective determination to address market challenges and ensure stability. By extending voluntary cuts and implementing coordinated measures, these nations are taking proactive steps to mitigate volatility and support sustainable oil prices.