(09 December 2019)DAILY MARKET BRIEF 2:OPEC, Allies Finalize Deeper Oil Production Cuts

OPEC and its allies completed a new production pact to deepen their oil-output cuts, delegates said Friday. The 24-nation consensus coincides with the initial public offering of Saudi Arabia's state-controlled national oil company, Aramco, and illustrates a renewed assertiveness from the alliance's de facto leader and Saudi's new oil minister, Prince Abdulaziz bin Salman. The Organization of the Petroleum Exporting Countries and their Russia-led allies completed additional collective production curbs of 500,000 barrels a day to last through the end of March, delegates said. The cuts had been agreed to in principle Thursday by OPEC but needed to be approved by its allies. The pact means the coalition will hold back a total of roughly 1.7 million barrels a day from global oil markets, deepening the current curb of 1.2 million barrels a day. Brent crude, the global gauge of oil prices, advanced 1.2% to $64.15 a barrel. Oil markets had questioned whether the cartel's move would result in real output reductions. There had been confusion, for instance, about how Saudi Arabia will cut. The kingdom agreed to reduce output by 167,000 barrels a day to 10.151 million barrels a day, according to OPEC delegates.

By Peter Rosenstreich