Saudi Arabia, Russia extend oil production cuts to raise prices

First modification: 07/04/2023 – 04:08

Saudi Arabia and Russia have announced they will cut the amount of oil they pump into the world in a joint effort to boost their fossil fuel revenue as global demand weakens and recession fears grow.

The prices suffered a slight rebound after the announcement of one of the main producers of the coalition of oil producers OPEC +. The Ministry of Energy of Saudi Arabia announced that the cut of one million barrels per day will be extended until August to support “the stability and balance of the oil markets.”

Following this announcement, Russian Deputy Prime Minister Alexander Novak announced a production cut of an additional 500,000 barrels per day in August.

But the cuts have not had much of an effect on prices. So far, the average price of a gallon of gasoline in the US is $3.53, according to the AAA auto club, while the price per barrel ranges from $70 to $80 per barrel.

For experts, the fact that the Saudis announced the cut reflects an uncertain view of fuel demand in the coming months. But there are concerns about economic weakness in the US and Europe, while China appears not to fully recover from its pandemic lockdowns.

with PA