The Organization of the Petroleum Exporting Countries and its allies (OPEC+) has announced
plans to reduce oil production by two million barrels a day starting this November.
The decision has drawn strong criticism from the U.S. and other countries that had been calling
on OPEC+ to pump more oil to help the global economy heading into winter.
However, OPEC+, meeting in-person in Vienna for the first time since 2020, has chosen to cut
production in order to raise oil prices that have fallen in recent months.
The production cut represents a reversal in policy. OPEC+ had cut its output by a record 10
million barrels a day in early 2020 when demand plummeted due to the pandemic.
The oil cartel has since gradually ramped up its production, albeit with some OPEC+ countries
struggling to fulfill their quotas.
Oil prices have fallen as low as $80 U.S. a barrel in recent weeks from more than $120 U.S. in
June amid growing fears of a global recession.
The production cut for November is an attempt to reverse the slide in oil prices and comes
despite repeated calls from U.S. President Joe Biden for OPEC+ to pump more oil to lower fuel
prices ahead of upcoming midterm congressional elections.
Brent crude oil, the international benchmark, was trading at $92 U.S. a barrel in London trading,
up 1.1% on news of the production cut. West Texas Intermediate (WTI) crude oil, the U.S.
standard, was trading at $87 U.S., up about 1%.
OPEC+ is scheduled to hold its next meeting on December 4.
