Saudi Arabia extends voluntary oil output cut of 1M bpd till end of year

Saudi Arabia will extend its voluntary oil output cut of 1 million barrels per day for another three months until the end of December 2023, state news agency SPA has reported.

The voluntary cut decision will be reviewed monthly to consider deepening the cut or increasing production depending on market conditions, SPA said on Tuesday, citing a Saudi energy ministry official.

Oil prices rose sharply following the news of the Saudi cut extension, with Brent prices rising above $90 a barrel for the first time since Nov. 18.

The international benchmark rose 1.4 percent to reach $90.24 at 1350 GMT while West Texas Intermediate, the main US futures contract, jumped 1.9 percent to $87.16.

The Saudi voluntary cut is on top of a previous production cut agreed upon by several producers in the Organisation of the Petroleum Exporting Countries along with Russia and other allies known as OPEC+, in April that extends to the end of 2024.

Daily production by the world's biggest crude exporter is approximately nine million bpd, far below its reported daily capacity of 12 million bpd.

Russia on Tuesday also extended its voluntary decision to reduce its oil exports by 300,000 bpd to the end of this year, Deputy Prime Minister Alexander Novak said in a statement on Tuesday.

Moscow will also review the voluntary reduction monthly and may deepen it or raise it, Novak said.