Saudi Arabia announced on Thursday that it will extend its voluntary oil cut by one million barrels per day for an additional month, to include the month of September. This decision comes within the framework of the Kingdom’s efforts to stabilize global oil markets, which are suffering from high inflation and weak demand.
According to the Saudi News Agency (SPA), the Kingdom’s production for next September will reach about 9 million barrels per day, that is, a million barrels less than its production in August.
An official source in the Saudi Ministry of Energy said that this voluntary reduction comes in addition to the reduction announced by the Kingdom last April, which extends until the end of December 2024.
The source added that Saudi Arabia is ready to take any other measures necessary to stabilize global oil markets.
The decision to extend the Saudi oil production cut comes at a time when global oil markets are suffering from high inflation and weak demand. The Russian-Ukrainian war caused oil prices to rise to record levels, leading to high inflation in many countries. Concerns about a global economic recession have also reduced demand for oil.
The Kingdom of Saudi Arabia is the world’s largest oil exporter, and its oil exports represent more than 70% of the country’s revenues. The stability of oil markets is important for the Kingdom, because it relies heavily on oil to finance its public budget and economy.
analysis
The decision to extend the Saudi oil production cut indicates that the Kingdom is committed to the stability of global oil markets. It also indicates that Saudi Arabia is ready to take additional measures to protect its economic interests.
This decision is expected to lead to a decline in oil prices in the near future. It may also help reduce inflation in many countries.
