…Nigeria to cut targeted production by 313,000bpd
Oil prices rose on Wednesday to their highest since February 2020 after Saudi Arabia agreed to reduce output more than expected in a meeting with allied producers, while industry figures showed U.S. crude stockpiles were down last week.
Brent crude rose as much as 0.9 per cent to $54.09 a barrel, the highest since Feb. 26, 2020. It was at $53.82 a barrel at 0757 GMT after jumping 4.9 per cent on Tuesday.
U.S. West Texas Intermediate (WTI) futures climbed as much as 0.6 per cent to $50.24 a barrel, also the highest since Feb. 26, before slipping to $49.96. The contract on Tuesday closed up 4.6 per cent.
Saudi Arabia, the world’s biggest oil exporter, agreed on Tuesday to make additional, voluntary oil output cuts of one million barrels per day (bpd) in February and March, after a meeting with the Organization of the Petroleum Exporting Countries (OPEC) and other major producers that form the group known as OPEC+.
The reductions agreed by Saudi Arabia were included in a deal to persuade other producers in the OPEC+ group to hold output steady.
The cartel, rising from its 13th OPEC and non-OPEC Ministerial Meeting (ONOMM), had upheld its December 3, 2020 decision to increase crude oil production output by 500,000 barrels per day for February and March, 2021.
The plan will, however, see Nigeria cut production by an additional 939,000 barrels in adherence to the resolution, with reference production set for the country by OPEC put at 1.829 million barrels per day in January, February and March.
But the required production per month will be 1,516 million barrels per day, a reduction of 313,000 barrels per day for each of the months.
OPEC directed its members and allies that have not fully complied with the output curbs agreed upon in April when the prices of some grades of oil in the international market became negative, to submit a compensation plan by January 15.
