0528 GMT October 20, 2019
Saudi Arabia, Kuwait, and the United Arab Emirates (UAE) will keep their July production within the limits set by the current deal expiring in June, OPEC sources told Reuters on Thursday.
The Saudis are pumping in June at around the same rate as in May, while their production in July will continue to comply with the current production cut deal, Reuters’ sources said.
Saudi Arabia pumped 9.69 mbd in May, according to OPEC’s secondary sources, while under the deal, the cap for the country is 10.311 mbd. Kuwait and the UAE also over-complied with their share of the cuts in May, though in much smaller proportions than the Saudis.
Earlier this week, The Wall Street Journal reported that Saudi Arabia is cutting its oil production even deeper this month as concerns over oil demand growth have intensified.
The Saudis are also asking other producers to follow and restrain production, OPEC officials told the Journal.
While Persian Gulf producers Kuwait and the UAE will follow the Saudi’s lead, the biggest unknown at the OPEC+ meetings rescheduled for July 1-2 is whether non-OPEC Russia will continue to play ball and agree to roll over the cuts.
“Russia is the only country that is yet to decide,” an OPEC source told Reuters, confirming comments from Saudi Energy Minister Khalid al-Falih from earlier this month that “a rollover is almost in the bag” for OPEC, but the group has yet to discuss the pact with the non-OPEC producers led by Russia.