2024-02-27T20:47:04+00:00
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/ Three sources in the OPEC+ alliance revealed on Tuesday a study to extend voluntary oil production cuts to the second quarter of this year.
The sources said in a statement to Reuters, followed by Agency: “The alliance will consider extending voluntary oil production cuts into the second quarter of 2024 to provide additional support to the market.”
Two of the sources said the coalition may keep the cuts until the end of the year.
OPEC and its allies agreed in November to voluntary cuts totaling about 2.2 million barrels per day during the first quarter of this year, which included Saudi Arabia extending its voluntary production cut.
Oil prices have been supported this year by rising geopolitical tensions over attacks by Yemen’s Houthi movement on commercial vessels in the Red Sea. Brent crude was trading near $83 a barrel on Tuesday.
“Extending production cuts into the second quarter is likely,” an OPEC+ source told Reuters, requesting anonymity.
Two of them said that “an extension for a longer period until the end of the year is possible.” Under the current agreement, total production cuts are scheduled to reach 3.66 million barrels per day starting in April.
Saudi Arabia said that “the cuts may continue after the first quarter if necessary.”
“OPEC+ has not formally discussed this matter yet,” two of the sources said.
Sources say a decision on extending the cuts is expected to be taken in the first week of next March, and that each country will announce its decision individually.
OPEC+ has implemented a series of production cuts since late 2022 to support the market amid rising output from the United States and other non-member producers, concerns about demand, and as major economies face a crisis of rising interest rates and seek to curb inflation.