Saudi Arabia Could Cut Up to 4% of Oil Production

Saudi Arabia and its Gulf OPEC allies are willing to cut 4 percent from their peak oil output, energy ministers from the Gulf countries told their Russian counterpart this week, sources familiar with the matter told Reuters.

The offer was made at a closed-door meeting in Riyadh, where the ministers met on Sunday. But Russian Energy Minister Alexander Novak told the officials that Moscow would not cut output, but rather freeze it at current levels, the sources said.

The 4 percent offer is likely to be made at a meeting of OPEC experts and officials from other oil producers such as Russia on Oct. 28-29 in Vienna, to nail down the details of last month’s OPEC production-cap agreement in Algeria.

Iraq, OPEC’s No. 2 producer, said this week that it would not cut output and should be exempted from any curbs as it needs funds to fight Islamic State. Baghdad’s stance is likely to face opposition from Riyadh and its Gulf allies, OPEC sources said.

“If there is a cut, then everyone must cut. No exemptions,” one OPEC source said, commenting on Iraq’s demands.

via Reuters

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza