Oil Prices Soar after OPEC+ Announces Surprise Production Cuts

OPEC+ members led by Saudi Arabia and the United Arab Emirates have announced their decision to cut production, abandoning their previous guarantees about stabilizing supply to maintain market stability. Among them, Saudi Arabia announced a plan to implement a voluntary production cut of 500,000 barrels per day from May until the end of 2023. This round of production cuts by OPEC+ total 1.1 million barrels per day.

Russia also announced that it will cut production by 500,000 barrels per day and continue until the end of the year.

This will bring the total production cuts to more than 1.6 million barrels per day, accounting for 1.5% of global crude oil demand.

Boosted by this news, oil prices rose as much as 8% at the opening of trading session.