Nigeria agrees to cut oil production

Oil prices have fallen below $ 60 a barrel in recent weeks from their peaks for 2019 to $ 75 as fears of a global recession outweigh concerns over sanctions-stricken Iran and Venezuela.

OPEC agreed on Thursday to reduce oil production by requiring members of Iraq and Nigeria’s over-production to bring production in line with its targets as the group strives to prevent a glare between US output growth and an economy global slowdown.

A market monitoring committee formed by the Organization of Petroleum Exporting Countries and its allies, a group known as OPEC +, met in Abu Dhabi on Thursday ahead of their policy discussions in Vienna in December.

OPEC + has been moderately overburdened with its agreed reduction of 1.2 million barrels a day as Iranian and Venezuelan exports plummeted due to sanctions. But some members, such as Iraq and Nigeria, have produced above their quota.

Iraq, OPEC’s second-largest oil producer, pledged Thursday to cut production by 175,000 bpd by October, while Nigeria will cut supply by 57,000 bpd.

The de facto leader of OPEC, Saudi Arabia, will continue to pump less than its target, said Prince Abdulaziz bin Salman, who took over as Minister of Energy from Khalid al-Falih on Sunday.

The kingdom will voluntarily overdeliver at its targets and pump a little less than 10m bpd, Prince Abdulaziz said.

He said Thursday’s meeting also discussed the increase in US shale production and exports, a global economic slowdown and a possible easing of US sanctions on OPEC member Iran.

The decision and any official decision on deeper oil cuts can only be made at the next OPEC + meeting in December, the prince said.

“I can honestly tell you that in all discussions we have discussed all possible uncertainties like any responsible organization and we are aware of them,” Prince Abdulaziz said.

“There is a clear willingness to continue to be responsible and accountable.”

He added that the ministerial committee would meet again before the full OPEC meeting in December.

OPEC, Russia and other non-members agreed in December to reduce output by 1.2 million bpd – or 1.2% of global supply – from January 1 this year.

OPEC’s cut, which now runs until March 2020, is 800,000 bpd, delivered by 11 members and excluding Iran, Libya and Venezuela.

Iraq has pumped 4.8m bpd in recent months instead of its 4.512m target. Nigeria produced 1.84 million bpd in August against its 1.685 million target./

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