Saudi Arabia Will Reduce Production by 1 Million Barrel

Saudi Arabia Will Reduce Production by 1 Million Barrel

Helima Croft from RBC Capital Markets stated that voluntary production cuts by OPEC members are doing their best to stabilize the market during the ongoing coronavirus outbreak of oil producing countries. Saudi Arabia said it will cut production by 1 million barrels a day starting June 1st. Saudi Arabia said on Monday it will reduce production by 1 million barrels a day from 1 June to support oil prices. Following the announcement of the kingdom, the UAE and Kuwait also announced supply cuts. This is above an agreement between OPEC and non-OPEC allies, sometimes called OPEC +, to reduce production from May 1 to 9.7 million bpd. Helima Croft, head of RBC Capital Markets global commodity strategy, said in her statements: “OPEC weights are trying to do their best to balance this market. As global locking conditions become easier and people start driving again, we are beginning to see a recovery in demand. So what they're basically doing is acting as an accelerator in terms of rebalancing the market. ” "If we get a second wave in the crisis, if re-restrictions are applied, it can really change the course of the recovery in oil prices."