Oil prices remain near their 10-month peak, with recent data showing that Saudi Arabian supply reductions have balanced out the increased production from countries like Iran.
A Bloomberg survey reveals that Saudi Arabia reduced its production by 170,000 barrels a day, precisely offsetting the combined output surge from Iran and Nigeria.
In August, the Opec group’s total output reached 27.8 million barrels a day, marking an increase of 40,000 barrels from July.
Saudi Arabia has continued its strategy of unilateral supply cuts by one million barrels a day, a measure introduced in July. This was aimed at bolstering global oil prices, especially considering the uncertain economic landscape in China, the leading global fuel consumer.
The decline in Saudi Arabia’s oil production comes at a time when its political rival, Iran, has boosted its output to a five-year record of just over 3 million barrels a day in the previous month. Notably, due to the impact of US sanctions on its production, Iran remains exempt from Opec’s production quotas.
The international benchmark, Brent crude, has seen a minor drop of 0.2% and is now trading just above $88 a barrel after gaining 7.5% in under two weeks.
Similarly, the US-based West Texas Intermediate has decreased by 0.2%, yet it remains above $85 a barrel.
