RIYADH - Oil output cuts by OPEC and its allies, together with pledges from other G20 nations and purchases by strategic reserves, could remove 19.5 million barrels per day from the market, the Saudi energy minister said.
US President Donald Trump said Monday that the actual output cuts may be deeper than the headline figure of 9.7 million bpd -- with top producers considering slashing output by 20 million barrels a day under the deal.
"People are saying 10 million but we think the number they will actually hit is going to be closer to 20 million barrels a day," Trump said at a press briefing.
He did not give details, but the figures chime with the Saudi breakdown.
The OPEC+ alliance, led by Riyadh and Moscow, agreed on Sunday to slash daily production by 9.7 million bpd over the next two months to arrest a slump triggered by the coronavirus shutdown and a price war between Saudi Arabia and Russia.
Saudi media on Tuesday quoted Energy Minister Prince Abdulaziz bin Salman as saying that G20 producers outside OPEC+ have pledged to cut 3.7 million bpd.
He also estimated purchases for countries' strategic petroleum reserves for use in emergencies at 200 million barrels over May and June, boosting the total impact to 19.5 million bpd.
Prince Abdulaziz said the kingdom could cut below its quota of 8.5 million bpd if necessary.
According to the deal, Saudi Arabia and Russia will cut 2.5 million bpd each from their production of 11 million bpd in October 2018.
But the minister was quoted by Energy Intelligence as saying that Riyadh will effectively be cutting 3.8 million bpd from current record-high output levels of 12.3 million bpd which were boosted during the price war.
Other Gulf states will be also cutting from recently increased output levels, he said.
"So, in reality, what OPEC+ will be doing effective May 1 will be a total of 12.5 million bpd," the minister said.
The spread of the coronavirus has hit oil demand hard, with experts estimating that one-third of global demand -- which stood at 100 million bpd before the disease -- is being wiped out.
"We have to watch what is happening with demand destruction and demand improvement, depending on how things evolve," the minister said.
Agence France-Presse
NEW YORK - Global stock markets were mixed on Monday ahead of key US economic data and a European Central Bank meeting, while crude prices gained as the new Saudi oil minister signaled he would defend oil prices.
Major US stock indices finished little changed ahead of key reports on consumer prices and retail sales for August later in the week.
Investors are in "wait and see" mode, said Art Hogan, chief market strategist at National Securities.
"It's a case of having a 2-week winning streak and not much of a rethink on it," he added.
Recent US data has been mixed, with August jobs growth lagging expectations, but services sector activity growing more quickly than expected, according to reports last week.
European bourses were also mixed, with London falling sharply as the pound rose on official data that showed the British economy grew by 0.3 percent in July, reducing the likelihood of a UK recession this year as Brexit looms large.
"While parliament seems to be falling apart, the economy is holding up reasonably well," noted Paul Dales, chief UK economist at research consultancy Capital Economics.
"July's surprisingly strong rise in GDP suggests that it has not fallen into a recession."
British MPs voted to demand Prime Minister Boris Johnson release confidential documents relating to Britain's EU exit, during a final day of defiance before he suspends their session until just weeks before Brexit.
Elsewhere, the euro wavered as dealers mulled speculation that the European Central Bank could decide this week to loosen monetary policy.
OIL RALLIES
Oil prices advanced as newly-installed energy minister Prince Abdulaziz bin Salman, said that oil production cuts would benefit all exporting nations, in an indication he will support further reductions to address an oversupplied market and sagging prices.
In his first comments since being appointed by his father King Salman on Sunday, the minister signaled no major change in approach in Saudi Arabia, the de facto OPEC leader which pumps about a third of the cartel's oil.
"The pillars of our oil policy are pre-determined and will not change," he told Saudi broadcaster Al-Arabiya.
The appointment of Prince Abdulaziz, half-brother to de facto ruler Crown Prince Mohammed bin Salman, marks the first time a royal family member has been put in charge of the all-important energy ministry.
He replaces veteran official Khalid al-Falih as the world's top crude exporter accelerates preparations for a much-anticipated stock listing of state-owned oil giant Aramco, expected to be the world's biggest.
KEY FIGURES AROUND 5 AM TUESDAY
New York - Dow: UP 0.1 percent at 26,835.51 (close)
New York - S&P 500: FLAT at 2,978.43 (close)
New York - Nasdaq: DOWN 0.2 percent at 8,087.44 (close)
London - FTSE 100: DOWN 0.6 percent at 7,225.81 (close)
Frankfurt - DAX 30: UP 0.3 percent at 12,226.10 (close)
Paris - CAC 40: DOWN 0.3 percent at 5,588.97 (close)
EURO STOXX 50: FLAT at 3,495.02 (close)
Tokyo - Nikkei 225: UP 0.6 percent at 21,318.42 (close)
Hong Kong - Hang Seng: FLAT at 26,681.40 (close)
Shanghai - Composite: UP 0.8 percent at 3,024.74 (close)
Pound/dollar: UP at $1.2342 from $1.2283 at 2100 GMT
Euro/pound: DOWN at 89.45 pence from 89.79 pence
Euro/dollar: UP at $1.1046 from $1.1029
Dollar/yen: UP at 107.23 yen from 106.92 yen
Brent North Sea crude: UP $1.02 at $62.52 per barrel
West Texas Intermediate: UP $1.33 at $57.85 per barrel
source: news.abs-cbn.com
