VIENNA, Austria – The committee of major oil producers, including Saudi Arabia and Russia, has recommended maintaining the current output strategy. Despite recovering prices, the cartel’s members have extended their production cuts in order to support oil prices. Brent crude has reached its highest level in over three months, reaching $85 a barrel. This price surge comes after oil prices peaked at over $130 a barrel following Russia’s invasion of Ukraine in February 2022.
In a virtual meeting, the Joint Ministerial Monitoring Committee (JMMC) reaffirmed its commitment to the production reduction strategy, which will extend until the end of 2024. The committee expressed its appreciation for Saudi Arabia’s additional voluntary cut of one million barrels per day (bpd), which the country has extended until September. Additionally, Russian deputy prime minister Alexander Novak announced a further cut of 300,000 bpd for September.
Despite concerns about the global economy, there are signs that the supply cuts are starting to have the desired effect. However, Saudi Arabia plans to gradually withdraw the voluntary cut over the coming months to avoid revenue shortfalls and dampening economic growth.
The next JMMC meeting is scheduled for October 4, with the next ministerial meeting set for November 26. The JMMC has no decision-making power, but its discussions and recommendations are formally discussed and decided upon at the organization’s ministerial meetings.
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