Oman will cut oil production by 23% in May & June 2020

The Omani Ministry of Oil and Gas said on Tuesday, April 14, 2020 that it will cut oil production by 23% in May and June, to comply with the OPEC+ cutoff agreed on Sunday, April 12, 2020, and condensates are excluded from the new cuts.

The ministry confirmed that the cuts would continue in different sizes until the end of the agreement in April 2022, according to the document S&P Global Platts had seen.

The decrease is equivalent to cutting 201,000 bpd during the two months, as PDO will bear the bulk of the cuts, which currently produces 630,000 bpd of oil.

OPEC and its allies agreed to reduce production by 9.7 million bpd in May and June, then to reduce 7.7 million bpd in the second half of 2020, and to reduce 5.8 million bpd from January 1, 2021 to April 30, 2022. The agreement aims to counter the resulting declining demand about the Covid-19 pandemic.

The Sultanate of Oman is the largest non-OPEC crude oil producer in the Middle East. Under the new agreement, it has a share of 680,000 bpd in May and June, comparing to 955,500 barrels in February. Under the previous OPEC+ agreement that expired in March 2020, Oman’s share was 961,000 bpd, according to S&P Global.