# Why did OPEC cut oil production? Key reasons explained

> OPEC and allies including Russia agreed to widen crude production cuts to 3.66 million bpd, or 3.7% of global demand. Saudi Arabia said its voluntary cut of 1.66 million bpd on top of existing 2 million bpd cuts was a precautionary measure. Prices rose by about $5 a barrel to above $85 after the announcement.

- Date: 2023-04-03 · published 2023-04-03T12:00:00.000Z
- Category: policy · region Global · magnitude medium
- Page: https://feedsoft.ai/events/36321-why-did-opec-cut-oil-production-key-reasons-explained
- Commodities: [Crude Oil (Brent)](https://feedsoft.ai/c/BRENT.md), [Crude Oil (WTI)](https://feedsoft.ai/c/WTI.md), [ULSD / Diesel](https://feedsoft.ai/c/DIESEL.md)

## Why it matters

The explanation confirms that the cuts are intended to support prices and that the reduction is sustained through 2023. Higher crude prices raise energy and transport costs for feed manufacturers.

## Read by commodity

- WTI: bullish ▲
- BRENT: bullish ▲
- DIESEL: bullish ▲

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| BRENT | 2022-10-06 | [Why is OPEC+ cutting oil production and what’s next? \| Explainer News \| Al Jazeera](https://feedsoft.ai/events/39328-why-is-opec-cutting-oil-production-and-what-s-next-explainer-news-al-jazeera.md) | -1.0% | +2.4% |
| BRENT | 2016-11-30 | [OPEC Production Cut: What It Really Means for Oil Prices \| Fortune](https://feedsoft.ai/events/74026-opec-production-cut-what-it-really-means-for-oil-prices-fortune.md) | +16.7% | +22.1% |
| BRENT | 2016-11-30 | [Oil Surges on OPEC Deal to Cut Production - WSJ](https://feedsoft.ai/events/73786-oil-surges-on-opec-deal-to-cut-production-wsj.md) | +16.7% | +22.1% |
| BRENT | 2018-12-03 | [Oil Prices Rise on Expectations for a Production Cut](https://feedsoft.ai/events/10625-oil-prices-rise-on-expectations-for-a-production-cut.md) | +6.0% | -10.4% |
| BRENT | 2018-12-07 | [OPEC and allies agree to cut oil production](https://feedsoft.ai/events/10629-opec-and-allies-agree-to-cut-oil-production.md) | +2.2% | -2.9% |
| WTI | 2022-10-06 | [Why is OPEC+ cutting oil production and what’s next? \| Explainer News \| Al Jazeera](https://feedsoft.ai/events/39328-why-is-opec-cutting-oil-production-and-what-s-next-explainer-news-al-jazeera.md) | -0.5% | +2.2% |
| WTI | 2016-11-30 | [OPEC Production Cut: What It Really Means for Oil Prices \| Fortune](https://feedsoft.ai/events/74026-opec-production-cut-what-it-really-means-for-oil-prices-fortune.md) | +12.5% | +19.3% |
| WTI | 2016-11-30 | [Oil Surges on OPEC Deal to Cut Production - WSJ](https://feedsoft.ai/events/73786-oil-surges-on-opec-deal-to-cut-production-wsj.md) | +12.5% | +19.3% |

## Sources

- reuters.com: https://www.reuters.com/business/energy/why-is-opec-cutting-oil-output-2023-04-03/

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.