Venezuela supports extension of OPEC supply cut

OPEC supply cut
Venezuelan President Nicolás Maduro says an extension of the OPEC supply cut would help his country obtain a “fair and stable income.” 

OPEC supply cut reduced production by 1.8 million b/d

On Tuesday, Venezuela announced it will support a nine-month extension of the OPEC supply cut, an effort by members and non-cartel members to reduce the global oversupply of crude.

Low oil prices had a staggering impact on Venezuela which relies on oil for 94 per cent of its export revenue.

The 2014 crash in oil prices led to dramatic social, economic and political consequences for the South American country. Protesters are angry with the poor economy, food and medicine shortages and soaring inflation.

In a statement, the oil ministry said “Venezuela believes that the agreement between OPEC and non-OPEC countries, which including the 24 largest oil producers in the world, has been successful in helping crude oil prices recover.”

President Nicolás Maduro says an extension of the pact will have an impact on the global economy and benefit producing countries with a “fair and stable income.”

Saudi Arabia, Russia, Iraq, Oman and Kuwait have said the OPEC pact, which has seen oil output cut by 1.8 million barrels per day, should be expanded beyond June of this year to the end of March, 2018.

On Monday, non-OPEC member Kazakhstan said expects its production to jump significantly and would struggle to join any new deal on the old terms.