Oman agrees cut output to support OPEC

Oman agrees cut output to support OPEC

Agence France-Presse, Muscat

Oman, an independent oil producer, on Thursday announced it
would cut production by 40,000 barrels per day (bpd) to back
OPEC's bid to force up crude prices.

"Oman will at the start of January and until June reduce
production by 40,000 bpd to support prices on the international
oil market," Oil Minister Mohammad bin Hamad al-Romhi told the
official ONA news agency.

The sultanate had at first said it would sacrifice just 25,000
bpd towards the 500,000 bpd target set for non-cartel producers
by OPEC which wants to reduce its own output by 1.5 million bpd.

Ministers of the Organization of Petroleum Exporting Countries
agreed in November to cut production by 1.5 million bpd from
Jan.1, but only on condition that non-OPEC major producers like
Russia, Norway and Mexico cut by half a million bpd.

After Norway made a firm pledge Monday to reduce output by
150,000 bpd if other producers also cut, OPEC had assurances of
an overall reduction of 447,500 bpd from non-OPEC producers,
including Russia (150,000 bpd), Mexico (100,000) and Angola
(22,500 bpd).

The new figure for Oman, which is currently producing 900,000
bpd, would push that to 462,500 bpd, leaving a target shortfall
of 37,500 bpd.

A barrel of Brent North Sea crude for February delivery was
going for US$19.55 a barrel from 19.47 at the close on Wednesday.
In New York overnight, the February light sweet crude contract
rose 20 cents on Wednesday to $19.80 a barrel.

"Prices are remaining firm because it would appear that Oman
is preparing to reduce its production by 40,000 barrels a day"
instead of the 25,000 barrels expected by the market, said
Prudential Bache dealer Luca Bertali.