In a surprise move, OPEC+ has announced that it will be cutting oil output by 1.16 million barrels per day (bpd). The decision was made in an effort to stabilize global oil prices and balance the market, which has been struggling due to oversupply.
The announcement sent crude prices jumping as much as 8%, with other OPEC members also announcing cuts to their oil production. Iraq, the United Arab Emirates, and Kuwait are among those who have joined the initiative.
However, not everyone is pleased with this move. The US has criticized it as potentially driving up inflation and increasing interest rates around the world. Geopolitical tensions between the US, Russia, and Saudi Arabia have also simmered beneath recent decisions regarding oil cuts.
The decision by OPEC+ to cut output comes at a time when crude prices are surging. In response, the US has pivoted towards other partners in order to lower energy costs and increase output.
Executives of U.S. oil companies recently warned that crude prices would likely move higher with the resurging influence of the OPEC+ cartel over international oil markets. This latest move is another indicator of fading relations between Saudi Arabia and the United States.
Meanwhile, efforts by UK officials to cut into Russia's oil revenues via sanctions imposed in response to its war on Ukraine could be undermined by this move from OPEC+.
The three biggest contributors to these reductions are Saudi Arabia, UAE (144k), and Kuwait (128k). Overall this decision marks another example of how OPEC+ continues flexing its market muscle over international affairs related to energy production while leaving countries like America scrambling for alternatives sources due largely in part because they feel threatened economically if they do not find them soon enough at home or abroad alike!