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US: Recent OPEC+ output cuts are 'unadvisable'

April 3, 2023 at 10:46 am

OPEC headquarters in Vienna [DALIBRI/Wikipedia]

The US administration today said that the production cuts announced by members of the OPEC+coalition were “not advisable”.

A spokesman for the National Security Council (NSC) said in a statement: “We don’t think cuts are advisable at this moment given market uncertainty – and we’ve made that clear.”

This comes after nine members of the coalition, Saudi Arabia, Russia, the UAE, Oman, Iraq, Kuwait, Gabon, Kazakhstan and Algeria, announced voluntary cuts in their oil production.

The decision to cut production, amounting to a total of 1.66 million barrels per day, starts in May and will continue until the end of 2023, as a precaution against conditions that will negatively affect global demand for crude oil, the Saudi Press Agency reported.

According to the NSC spokesman: “We’re focused on prices for American consumers, not barrels, and prices have come down significantly since last year, more than $1.50 per gallon from their peak last summer. We will continue to work with all producers and consumers to ensure energy markets support economic growth and lower prices for American consumers.”

Last month, Brent oil prices fell to around $73 a barrel due to the US banking crisis, before settling at the end of March at $79 a barrel, compared to an average of $95 a barrel in 2022.

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