DUBAI - Even after OPEC powerhouse producers Saudi Arabia and Russia extended yet again this month oil production cuts until September, the weight of maintaining high prices is taking its toll on the kingdom’s goals for economic growth.
Saudi Arabia’s production for September 2023 will be about 9 million barrels per day (bpd) according to the state-owned Saudi Press Agency (SPA). This includes the 1.6 million bpd agreed upon by OPEC Plus members in April, that extends until December 2024.
“This additional voluntary cut comes to reinforce the precautionary efforts made by OPEC Plus countries with the aim of supporting the stability and balance of oil markets,” the kingdom’s Ministry of Energy said in the SPA statement. Brent Crude traded at about $86.671 at 6:30 a.m. Eastern Standard Time on Friday, according to the Dow Jones subsidiary Market Watch.
Oil had a seven-week rally, the longest streak in more than a year, reported Bloomberg on Thursday, with crude climbing about 20% since late June. In addition, oil demand is expected to reach record highs, increasing by 2.2 million barrels per day (mb/d) to 102.2 mb/d this year, according to the International Energy Agency (IEA) Oil Market Report – August 2023, released Friday. The report attributed 70% of the growth in demand to China’s surging petrochemical activity.
