South Sudan is joining the Organization of Petroleum Exporting Countries (OPEC) and OPEC+ in a unifying agreement to cut oil production by May 1, 2020 in a bid to revive the falling prices due to coronavirus pandemic.
OPEC members envision that the cut will enable oil market to rebalance and keep prices stable until at least 2022.
South Sudan Petroleum Minister Puot Kang Chol said the government of President Salva Kiir will work hard in “doing its utmost best in meeting the oil production adjustment targets”.
“These are priorities and we will continue collaborating with all our partners to preserve the interests of our industry and our economy,” he said.
The minister said the pandemic has disrupted the country’s effort to revive it’s 350,000 barrels per day glory which was wrecked during the civil war.
“Our production was over 350, 000 bpd before the civil war and following continuous efforts to put damaged fields back into production, we are currently producing about 185 000 bopd. Our target is to attract more investment into our oilfields to get our nation back to a production level of 300 000 bpd,” the minister stated.
“The current price war and the coronavirus pandemic have affected our economy and prospects for investments so we naturally welcome all efforts to stabilise the oil market and the Republic of South Sudan will continue to play its role in ensuring market stability for the benefit of all stakeholders,” he added.
Members of OPEC and their allies, including Russia and Mexico, announced Sunday that they have agreed to cut production by 9.7 million barrels a day in May and June, the deepest cut ever agreed to by the world’s oil producers.
After that, the group will steadily ramp up production until the agreement expires in April 2022.
The group, which together is known as OPEC+, had been seeking to cut production in order to buoy oil prices, which fell to 18-year lows in recent weeks.
The drop came after Saudi Arabia and Russia abandoned years of production cuts in early March, launching a price war by flooding the market with crude.
The coronavirus, meanwhile, dealt a devastating blow to energy demand, pushing prices even lower.