Vienna, Austria (CNN) – Saudi Arabia agreed, on Tuesday, to voluntarily reduce its oil production by one million barrels per day, a concession that will keep energy production by OPEC members and their allies below current levels despite the increase requested by Russia and Kazakhstan.
Saudi Energy Minister Prince Abdulaziz bin Salman said during a press conference after the conclusion of the “OPEC Plus” meeting: “We do this voluntarily and we do so with the aim of supporting our economy and the economies of our colleagues.” He added, “We did not ask any country to come forward and make any cuts.”
The main group of energy producers is trying to support prices during an unprecedented drop in demand due to the Corona epidemic. OPEC Plus agreed to allow Russia and Kazakhstan to add 75,000 barrels per day of crude to their current production levels in February and March.
The two countries were pushing for bigger increases in production, which led to a dead end at Monday’s meeting.
After the announcement of the OPEC Plus deal, US oil prices rose 5.2%, or $ 2.48, to $ 50.10 a barrel.
Bjornar Tonhaugen, head of oil market research at Rystad Energy, said, “It is really surprising that Riyadh proposes to reduce its production, because this effectively means that it is ready to give up its market share.”
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