MercoPress. South Atlantic News Agency

Venezuela supports OPEC production cuts of 2 to 4m bpd

Venezuela is ready to sponsor a new cut in crude production to protect the oil market, two to four million barrels per day, confirmed Rafael Ramirez, Energy Minister and President of Petroleos de Venezuela (PDVSA), the country's government owned oil corporation.

"There is a slowdown in demand, where OPEC has indicated that more than 180 thousand barrels less oil are demanded," said Ramirez. "That means we must reduce the amount of oil on the market to avoid inventory build", but did not say how much of the burden Venezuela was willing to share. In presenting his 2008 Annual Report to the National Assembly, President Hugo Chávez said Venezuela would be willing to support a further cut of between 2 million and 4 million barrels per day (bpd) to protect oil prices. Ramirez said Venezuela, a member of the Organization of Petroleum Exporting Countries, or OPEC, would not stand in the way of efforts by the cartel to cut output further. Venezuela is satisfied with the production cuts agreed to by OPEC members over the past five months to try to prevent a collapse in oil prices and inventory build-up, Ramirez said. "We are monitoring our cuts, which began on January first, of 189,000 barrels per day, adding to the events in September for a total of 364,000 barrels," said Ramirez. At the start of the month Venezuela cut its oil production by 189,000 barrels per day (bpd) to comply with an agreement reached by OPEC members in Algeria on Dec. 17. That production cut followed previous OPEC agreements that slashed output by 46,000 bpd in September and 129,000 bpd in October, taking a total of 364,000 bpd off the market. If Venezuela had not made the cut in oil production in November 2008 and January this year, "the price situation would be much more complex and deteriorating for producer countries," said Ramirez. OPEC has cut 4.2 million barrels a day over the last year. Ramirez revealed that Venezuela's current output was more than 3 million bpd. OPEC and other international agencies put it closer to 2 million, however.