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Oil prices jumped more than 5% after Saudi Arabia announced a further voluntary cut in production, and Brent hit $ 53.71, gaining 5.13%.
WTI also rose 5.29%, crossing the $ 50 threshold.
Saudi Energy Minister Prince Abdulaziz bin Salman described the voluntary reduction in oil production as a goodwill gesture from Saudi Crown Prince Mohammed bin Salman to support oil markets.
Saudi Arabia announced a further voluntary cut in oil production by one million barrels per day in February and March, on top of its share of the OPEC + group cuts.
The countries in the group agreed to increase oil production by 75,000 barrels per day in February, and again in March, reducing production cuts by that amount.
The OPEC + group has decided to hold the next meeting of the joint ministerial committee to monitor the oil production agreement on February 3 and the next enlarged meeting of the group on March 4, 2021.
OPEC + has asked non-compliant countries to submit compensation plans by January 15.
Russia and Kazakhstan
The OPEC + agreement will allow Russia to increase production by 65,000 barrels per day, and Kazakhstan by 10,000 barrels per day in February and the same in March.
The group, made up of thirteen Saudi Arabia-led OPEC members and their 10 Russian-led allies, have sought to find a compromise between those who prefer to maintain current cuts in production levels due to uncertainty. of the market caused by the Covid-19 pandemic, and those who prefer to produce an additional 500,000 barrels. Every day on the market.
The group has stepped up the pace of its monthly meetings due to price fluctuations due to the health crisis and the damage it was inflicting on the global economy.
Demand has dropped
Demand for crude oil has collapsed due to national closures linked to the pandemic in 2020, and oil-producing countries are trying to adjust their production to support black gold prices.
The latest round of meetings, between November 30 and December 3, “paved the way for a gradual return of two million barrels per day to the market over the next few months, with participating countries ready to adjust these levels by depending on market conditions and their evolution, ”said the OPEC Secretary General. Mohamed Barkindo Sunday.
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