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OPEC
An oil well pumps next to a newly constructed neighborhood near Signal Hill in Long Beach, California in this April photo. OPEC agreed Saturday to continue reduced oil production to keep oil markets stable during the coronavirus pandemic. (Jim Ruymen/UPI photo)

VIENNA, Austria (UPI) — OPEC and its allies have agreed to extend the group’s cuts on oil production through July.

During a Saturday video-conference meeting Saudi Arabian Energy Minister Prince Abdulaziz bin Salman said there are grounds to be “cautiously optimistic about the future,” but there are still economic challenges ahead for oil producers and encouraged a swift decision to stabilize oil markets and keep oil prices high.

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“Together we are stronger, together we can restore stability to oil markets and help rebuild the global economy,” he said.

The alliance cut oil production by 9.7 million barrels per day at the beginning of May, a decision reached after oil prices collapsed in April due to the coronavirus pandemic.

That represents about 10 percent of global output in normal times.

The original plan was to begin increasing production in July, but instead have decided to continue at a reduced level of production — this time by 9.6 million barrels per day.

The alliance will continue to review cuts on a monthly basis and have scheduled another meeting for June 18.

Not all OPEC nations have abided by their prescribed quotas, and nations that have failed to sufficiently cut output were directed to enact additional cuts in July, August and September in order to compensate for non-compliance in May and June.

Reporting by Christen McCurdy

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