Saudi Press

Saudi Arabia and the world
Saturday, Feb 22, 2025

OPEC+ production cuts likely to lift oil prices above $100 a barrel

OPEC+ production cuts likely to lift oil prices above $100 a barrel

The OPEC+ group’s surprise additional production cuts could push oil prices back toward $100 a barrel, tighten the market and encourage refiners to diversify supplies, analysts and traders said.
Oil prices jumped more than $4 a barrel on Monday after the Organization of the Petroleum Exporting Countries and their allies including Russia announced further production cuts of about 1.16 million barrels per day from May through the rest of the year.

The pledges will bring the total volume of cuts by the group known as OPEC+ since November to 3.66 million bpd according to Reuters calculations, equal to 3.7 percent of the global demand.

OPEC+ had been expected to hold output steady this year, having already cut by 2 million bpd in November 2022.

Rystad Energy said it believed the cuts will add to tightness in the oil market and lift prices above $100 a barrel for the rest of year, possibly taking Brent as high as $110 this summer.

UBS also expects Brent to reach $100 by June, while Goldman Sachs raised its December forecast by $5 to $95.

Goldman said strategic petroleum reserve releases in the US and in France, due to ongoing strikes, as well as Washington’s refusal to refill its SPR in the 2023 fiscal year, may have prompted the OPEC+ action.

An official at a South Korean refiner said the cut was “bad news” for oil buyers and OPEC was seeking to “protect their profit” against concerns of a global economic slowdown.

The supply cut would drive up prices just as weakening economies depress fuel demand and prices, squeezing refiners’ profits, the South Korean refining official and a Chinese trader said.

Both declined to be identified as they were not authorized to speak to media.

Saudi Arabia said its voluntary output cut was a precautionary measure aimed at supporting market stability.

Purchases by China, the world’s top crude importer, are expected to hit a record in 2023 as it recovers from the COVID-19 pandemic, while consumption from No.3 importer India remains robust, traders said.
Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Saudi Arabia and the United States Strengthen Ties Amid Global Developments
Saudi Arabia Hosts Global Conference to Promote Islamic Unity
The Impact of Artificial Intelligence on Education and Child Development
Saudi Arabia Announces Competition for Best Founding Day Outfits
Saudi-EU Food Security Officials Hold Talks to Strengthen Collaboration
Putin Expresses Gratitude to Saudi Crown Prince for Hosting US-Russia Talks
UK and Saudi Arabia Enhance Collaboration in Innovation and Technology
Denmark's Embassy in Riyadh Showcases Danish Cuisine with Saudi Influence
Saudi Artist Salman Al-Amir Unveils 'Tafawut' Exhibition in Riyadh
Saudi Arabia Offers Condolences to Kuwait Following Military Exercise Fatalities
Saudi Ministry of Islamic Affairs Completes Ramadan Preparations in Madinah
Etidal Secretary-General Hosts UN Counter-Terrorism Director in Riyadh
ADNOC Drilling Targets Over $1 Billion in Investments for 2025 Amid Gulf Expansion Plans
Derayah Financial Achieves Remarkable Growth in Saudi Brokerage and Asset Management
Saudi Arabia Shortlists 30 Firms for Mining Licenses in Eastern Province and Tabuk
Saudi Foreign Minister Engages Counterparts at G20 Meeting in Johannesburg
Oil Prices Decline Amid Rising US Inventories
Saudi Arabia's NDMC Plans Green Bond Issuance by 2025
Moody’s Affirms Egypt’s Caa1 Rating Amid Positive Economic Outlook
Oman and Saudi Arabia Strengthen Economic Ties with New Agreements
Saudi Arabia Investments Propel Expansion of Qurayyah Power Plant
Saudi Capital Market Authority Advances SPACs and Direct Listings
Global Energy Leaders Gather in Riyadh for Symposium on Energy Outlooks
Al-Ahsa Region Sees 500% Growth in Tourism as Saudi Arabia Prioritizes Development
Saudi Arabia Advances Entrepreneurial Ecosystem in Al-Ahsa with New Agreement
King Salman Approves Official Saudi Riyal Symbol
Saudi Credit Card Lending Reaches $8.4 Billion Amid Digital Payment Expansion
King Salman Approves Official Symbol for Saudi Riyal
Putin Thanks Saudi Crown Prince for Facilitating U.S.-Russia Discussions
Saudi Foreign Minister Attends G20 Meeting in Johannesburg
Saudi Arabia Prepares for Nationwide Founding Day Celebrations
Inauguration of Hira Park and Walkway Enhances Jeddah's Urban Landscape
Crown Prince Hosts Leaders for Informal Meeting in Riyadh Amid Gaza Rebuilding Plans
Saudi Official Highlights Achievements and Media's Role in National Transformation
Three Expatriate Women Arrested for Prostitution in Riyadh
Saudi Arabia's Diplomatic Evolution Highlighted at Saudi Media Forum
Healthy Eating and Preparation Essential for Ramadan Fasting
Saudi Arabia and Japan Forge Sustainable Textile Partnership
Advanced Limb Surgery Restores Mobility in Pediatric Cancer Patient
Jeddah Event Explores AI's Role in Boosting Saudi Arabia's SME Sector
UN Representative Highlights AI's Role in Perpetuating Gender Stereotypes
Saudi and Jordanian Leaders Discuss Enhanced Security Cooperation in Amman
Saudi British Society Honors Cultural Bridge-Builders at London Gala
Saudi Media Forum 2025 Explores AI's Role in Modern Journalism
Saudi Arabia's Saqer Al-Moqbel Appointed as WTO General Council President for 2025–2026
Saudi Deputy Ministers Engage in Diplomatic Discussions with U.S. and Dutch Officials in Riyadh
Saudi Arabia to Launch Iftar Program in 61 Countries During Ramadan
Saudi Visitors Expected to Spend £942 Million in UK During 2025
Saudi Arabia Gifts Kaaba's Kiswah to Uzbekistan's Center of Islamic Civilization
Digital Cooperation Organization Concludes Fourth General Assembly with Multiple Agreements
×