Oil Production May Be Cut

Oil drum image

CBJ — Both Russia and Saudi Arabia are contemplating a drop in oil production as part of an effort to prop up slumping prices.

It’s expected that Saudi Arabia will reduce its exports by 500,000 barrels a day for at least the duration of this month.

Russia has not yet made a commitment to cuts, but seems to be open to the idea if they are approved by a coalition of producers including OPEC.

Saudi Arabia and Russia are the world’s biggest exporters, although the United States now produces more oil, and uses a significant amount of it for domestic purposes.

Concern about oversupply has pushed oil prices down by 20% since early October. The decline in prices continued last week after the U.S. said it would let eight countries keep importing Iranian oil.