Saudi Aramco Cuts Oil Production to 8.5 Million Bpd

An official source revealed that Saudi Arabia's state-run oil company Aramco will cut oil production after the OPEC+ agreement will come into effect as of  May 1.

"Aramco is expected to supply 8.5 million bpd of crude starting May 1," the company said on Friday in a statement to the Saudi stock exchange Tadawul.

According to Bloomberg, the source added that the Saudi company will cut production from about 12 million barrels per day to the agreed level of 8.5 million bpd.

Saudi Arabia is expected to cut its oil production by 3.5 million bpd, from 12 million bpd to 8.5 million bpd.

Saudi Arabia has joined Kuwait, Algeria, and Nigeria, members of the Organization of Petroleum Exporting Countries (OPEC), to start cutting production earlier.

The OPEC and its allies, 23 countries, agreed this month to reduce global production by 10%  in an effort to achieve a balance in a turbulent market due to the coronavirus (COVID-19) crisis.

Saudi energy minister Prince Abdulaziz bin Salman has said that the Kingdom could cut oil output below its current quota of 8.5 million bpd if needed.

It is worth mentioning that the U.S. benchmark West Texas Intermediate (WTI) index for the May delivery fell to a record low of minus $40 a barrel last week, the first time it had fallen into negative territory, to rebound again for a second straight session by 9% to $17.95 per barrel on Friday.

The Brent crude, however, traded as much as 6.4% higher to $22.70 per barrel.