OPEC Cuts Oil Production 1.2 Million Barrels/Day First Cut Since 2008

OPEC Cuts Oil Production 1.2 Million Barrels/Day First Cut Since 2008

The much anticipated headline is out and, as Bloomberg reports, OPEC has reached a deal agreeing to cut oil production by 1.2 million barrels per day to 32.5mmbpd from the current level of 33.6mmbpd, according to a delegate. This would be OPEC’s first production cut since 2008.

  • OPEC REACHES AGREEMENT TO CUT OIL OUTPUT: DELEGATE
  • OPEC AGREES TO CUT OUTPUT BY 1.2M B/D TO 32.5M B/D: DELEGATE

Saudi Arabia, Iraq and Iran appear to have resolved their differences over production cuts for the time being, with the Saudis accepting that Iran can raise production to about 3.9 million barrels a day. Still it appears some last minute glitches remains:

  • OPEC MINISTERS STILL DEBATING DETAILS OF OIL OUTPUT CUT PROPOSAL FOR SOME COUNTRIES INCLUDING IRAQ – SOURCES. RTRS.
  • IRAQ PM BEING CONSULTED BY OIL MINISTER ON PROPOSED OPEC OUTPUT CUT – OPEC SOURCE. RTRS

Although as a local reporter notes, the Iraq issue appears to have been resolved:

In a potential twist, however, the agreement is also likely to include a reduction of about 600,000 barrels a day by non-OPEC countries according to Bloomberg. This means that there is an element of conditionality to the deal should Non-OPEC nations balk when they sit down with OPEC members next to discuss the final deal framework.

We now await the details of who will cut and by how much, how will the production cuts be implemented and supervised, and whether the deal is conditional on Non-OPEC, mostly Russia, participation. Having soared over 7% in advance of the announcement, crude remained near its highs of the day.  The front-month Brent contract also resumes climb, trading $3.55 higher at $49.93.

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Rory Hall, The Daily Coin. Beginning in 1987 Rory has written over 1,000 articles and produced more than 300 videos on topics ranging from the precious metals market, economic and monetary policies, preparedness as well as geopolitical events. His articles have been published by Zerohedge, SHTFPlan, Sprott Money, GoldSilver, Silver Doctors, SGTReport, and a great many more. Rory was a producer and daily contributor at SGTReport between 2012 and 2014. He has interviewed experts such as Dr. Paul Craig Roberts, Dr. Marc Faber, Eric Sprott, Gerald Celente and Peter Schiff, to name but a few. Don't forget to visit The Daily Coin and Shadow of Truth YouTube channels to enjoy original videos and some of the best economic, precious metals, geopolitical and preparedness news from around the world.