Global energy markets and industry insiders believe that it was a good idea for Saudi Arabia to slash oil production by one million barrels daily until the end of March 2021. While it certainly helped to buoy short-term oil prices and spark a sense of optimism regarding the outlook for oil prices, which were severely impacted by the fallout from the COVID-19 pandemic, it may not be as favorable as initially believed. The surprise cut allowed a new OPEC Plus production agreement to be established after initial discussions failed because some participants, notably Russia and Kazakhstan, wanted to increase their petroleum output. By implementing the cut, the cartel’s oil production for January, February, and March 2021 will average 22.119 million barrels per day, a 13.6% decrease compared to the 25.6 million barrels per day pumped during 2020. When the cut was announced oil prices soared, gaining 10% since the […]