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Oman to Cut Oil Output by 2% for 6 Months

Oman to Cut Oil Output by 2% for 6 Months

Saturday, 15 December, 2018 - 05:30
FILE PHOTO: An oil pump jack is seen at sunset near Midland, Texas, US, May 3, 2017. REUTERS/Ernest Scheyder/File Photo
London - Asharq Al-Awsat
Oman will be cutting oil output by 2 percent from January for an initial period of six months, according to a letter sent to customers of Omani oil by the country’s oil and gas ministry, which was seen by Reuters.

The output reduction is in implementation of an agreement by The Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC crude exporters to reduce global supply, the letter said. Oman is not a member of OPEC.

OPEC and its Russia-led allies agreed last week to slash oil production by more than the market had expected despite pressure from US President Donald Trump to reduce the price of crude.

Oil prices dropped more than one percent on Friday, weighed down by a falling US stock market, while weak economic data from China pointed to lower fuel demand in the world’s biggest oil importer.

Bloomberg said that The International Energy Agency slashed its forecast for new supplies outside OPEC next year because of a lower outlook for Russia -- which is cooperating with OPEC -- and Canada, which is separately suppressing output to deplete brimming inventories.

“Time will tell how effective the new production agreement will be in rebalancing the oil market,” said the Paris-based IEA, which advises most of the world’s major economies on energy policy. “Stocks have been building with the potential for significant oversupply next year.”

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