Saudi Arabia, the world’s largest oil exporter, has already cut production more than required under an agreement between the Organisation of Petroleum Exporting Countries (OPEC) and allies outside of the group to help drain inventories and reach market stability.
Wednesday 14, August 2019
Saudi Arabia plans to keep oil exports below seven million barrels a day next month as OPEC’s biggest producer allocates less crude than customers demand in a bid to stabilise the market, reported Bloomberg.
Saudi Aramco will cut customer allocations across all regions by a total of 700,000 barrels a day next month and the country’s production will be lower in September than in August.
Additionally, for North American customers, the Kingdom will send about 300,000 barrels a day less than they nominated for oil scheduled to load in September. Reductions to European buyers is expected to be larger and there will also be modest cuts to Asian buyers.
Saudi Arabia is reducing allocations despite strong consumption in all regions. While the Kingdom could have produced about 10.3 million barrels a day because demand is much higher, it decided to keep output and exports suppressed. The producer and its partners in the OPEC+ coalition are determined to do what they can for market stability.
Oil has been swept up in a global market meltdown as the US-China trade dispute worsened, spurring fears it would morph into a currency war.