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Saudi Arabia will cut additional 100,000 bpd of its oil production next month and keep its exports below 7 million bpd in March in a bid to help clear the global oversupply and counteract the recent oil market volatility.
Saudi Aramco, the state oil giant, will pump 100,000 bpd less crude oil in March compared to the February level, the Saudi energy ministry said on Wednesday.
The Saudi oil exports will continue to be below 7 million bpd in March, despite the 400,000-bpd SAMREF refinery shutting down for planned maintenance, the ministry said.
Last month, Saudi Arabia was said to be planning to keep the low level of its crude oil exports in the first quarter this year at around 7 million bpd, despite planned refinery shutdowns for maintenance at home.
According to OPEC’s latest production figures released earlier this week, Saudi Arabia lifted its January production by 23,300 bpd to 9.977 million bpd—but still below its 10.058-million-bpd quota, over-complying once again.
The market volatility and the plunge in oil prices—from over $70 to $62 a barrel Brent—in just two weeks has raised concerns that oil is on another downturn, and Saudi Arabia returns to reiterate its pledge that it will do “whatever it takes” to bring global inventories back to balance.
“Saudi Arabia remains focused on working down excess oil inventories,” Reuters quoted a ministry spokesman as saying in a statement today.
“Market volatility is a common concern for producers and consumers, and the Kingdom is committed to mitigating this volatility and moderating its negative impacts by responsibly meeting its pledges” under the OPEC/non-OPEC production cut deal, he said.
“I am confident that our high degree of cooperation and coordination will continue and bring the desired results,” Saudi Energy Minister Khalid al-Falih said at an industry conference in Riyadh on Wednesday.
“Market volatility is unfortunate but ultimately it is the fundamentals that I watch,” al-Falih noted. By Tsvetana Paraskova for Oilprice.com