Kuwait cuts January oil output to agreed Opec target
06 Jan 2017 - 21:57
Dubai: Gulf Opec member Kuwait has reduced oil production in January to around 2.707 million barrels per day, meeting its output target under an Opec supply cut agreement, a Kuwaiti oil official said yesterday.
It joins Saudi Arabia which also cut production this month by at least 486,000 bpd to its 10.058 million bpd target, according to a Gulf source familiar with Saudi oil policy, meaning it fully implemented Opec’s agreement to reduce output. The Organization of the Petroleum Exporting Countries in November agreed to implement output reductions this year as part of a global pact to limit supplies to support prices.
A committee responsible for monitoring compliance with the global oil production cut agreement will meet in Vienna on January 21-22, although an industry source said that it would mainly discuss the mechanism to monitor compliance since no solid production data is available yet.
Brent crude futures, the benchmark for international oil prices, were trading at $57.75 per barrel at 1443 GMT, down 14 cents from the previous close after trading as much as 58 cents higher earlier in the day. In the United States, West Texas Intermediate (WTI) crude futures were $53.74 a barrel, 3 cents below their last settlement, after trading as much as 56 cents above it.
"There's a lot of volatility, or at least changes in direction," ABN Amro senior energy economist Hans van Cleef (pictured) said. "People think the long-term trend is up, but after a gain of a few dollars, they take profit." Under the Opec deal, Kuwait agreed to reduce output by 131,000 bpd starting January 1, from its October baseline production of 2.838 million bpd.
Kuwait produced 2.9 million bpd in December, an industry source familiar with the matter said. The pledges by major Opec producers such as Saudi Arabia and its Gulf Opec allies Kuwait and the UAE to comply with the cut agreement helped buoy oil prices.