Opec+ agrees to cut 2m bpd at delayed meeting

Reuters

• Meeting delayed by 4 days
• Saudi to cut 1m bpd
• Crude prices up 1%

Early reports indicated on Thursday that Opec+ members, led by Saudi Arabia, have agreed at their delayed meeting to cut oil output by nearly 2 million barrels per day, above supply curbs agreed in June.

Crude prices rose nearly 1 percent in anticipation of the decision; Brent traded at $82.51.

Saudi Arabia, Russia and other members of Opec+ pump about 43 million bpd, or roughly 40 percent of global supply.

• Opec says IEA has ‘vilified’ oil and gas producers
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• Morgan Stanley expects Opec to rein in output

Saudi Arabia, the leader of Opec, agreed at the meeting to cut its output by an additional 1 million bpd, while Russia will curb production by 0.5 million bpd, according to Reuters.

Other countries will also participate in cuts to support prices: Algeria agreed to cut its January output by an additional 50,000 bpd, according to its energy minister, Mohamed Arkab.

It is not clear whether Opec+ members reached an agreement over quotas for African countries, which have been a source of friction in recent negotiations.

The cut in oil supplies is designed to spur a recovery in prices, which dropped below $80 last week from September levels that approached $100.

Prices have fallen despite concerns about a weakening physical market resulting from increased supply from Opec and non-Opec producers, the war in Gaza, and a global softening demand.

The Opec+ members met virtually after delaying a meeting that was due to take place last week.

In an indication that the countries have not agreed on the direction of policy, the major producers may meet again before the end of the year.