Saudi Arabia tells Opec it cut oil output by most in eight years

Kingdom reports it slashed output by 717,600 barrels last month to 9.748m barrels

Saudi Arabia told Opec it cut oil production by the most in more than eight years, going beyond its obligations under a deal to balance world markets.

The kingdom reported that it reduced output by 717,600 barrels a day last month to 9.748 million a day, according to a monthly report from the Organisation of Petroleum Exporting Countries. The group’s own analysts, who compile data from external sources, estimated that Saudi Arabia made a smaller 496,000 barrel-a-day cut — in line with last year’s supply agreement.

“Opec has done particularly well, they’ve surprised most analysts,” Spencer Welch, director of oil markets and downstream at IHS Markit, said in a Bloomberg radio interview before the report was published. “Saudi Arabia has made a particular boost compliance.”

Prices crash

effort to

Opec and Russia are leading a push by global producers to end a three-year oil surplus that sent prices crashing and battered their economies.

Saudi Arabia’s data indicate it’s pumping about 310,000 barrels a day below its specified target. Saudi Arabian Energy Minister Khalid Al Falih had said on December 10 that the kingdom was willing to cut even more than was required to demonstrate its commitment to the accord. In the same monthly report, Iraq, Venezuela and Iran told the organisation they pumped more than allowed by the accord.

The negotiations leading to Opec’s agreement in November were marked by a dispute over which production data to use.

AFP Kuwaiti oil minister Essam Al Marzouk (right) speaks to the press in Kuwait City yesterday. Opec has implemented more than 90 per cent of its agreed output cuts aimed at curbing a glut on world markets, he said.