<article><p class="lead">Non-Opec producer Oman has already instructed all operators and oil producers in the sultanate to cut crude oil output for two months beginning 1 May, in line with its commitments under yesterday's Opec+ production restraint agreement.</p><p>The Opec+ alliance, which brings together Opec's 13 members with 10 non-Opec producers led by Russia, signed off on a landmark two-year agreement late yesterday that will take a combined 9.7mn b/d off the market in May and June. The cuts will moderate to 7.7mn b/d in the second half of the year and to 5.8mn b/d from January 2021 to April 2022. </p><p>Production will be cut from each member's October 2018 baseline, apart from the Opec+ group's two de facto leaders Saudi Arabia and Russia, which will each have a 11mn b/d reference level. </p><p>Under the terms of the deal, Oman has committed to cap its crude oil production at around 680,000 b/d in May and June, down 200,000 b/d, from its 883,000 b/d baseline level. </p><p>Oman's condensate production will not be constrained by the deal, as per an exemption that several non-Opec producers, including Russia, negotiated at their meeting in December. </p><p>The ministry of oil and gas (MOG) said Oman's customers will be informed of this change tomorrow. </p><p>With condensate production currently "around 150,000 b/d," according to a source at the MOG, the move should theoretically cap Oman's total production at around 830,000 b/d in May and June. </p><p>In February, the last month for which the MOG has released data, production averaged 955,500 b/d crude oil and condensate. </p><p>Sources at the MOG told <i>Argus</i> last month that overall crude and condensate output would average close to the late level in March. </p><p>And prior to the start of discussions earlier this month that resulted in yesterday's Opec+ agreement, sources said Oman was preparing to ramp its total crude oil and condensate production back up to around 1mn b/d as the cooperation between Opec and its non-Opec allies looked to have come to an end. </p><p>Oman's production last exceeded 1mn b/d in November 2018, when the Opec+ group temporarily relaxed production restraints over fears that US sanctions on Iran's crude exports could result in a global supply shortage. </p><p>It is unclear whether Oman still plans to raise its overall production towards 1mn b/d this month given the existence of the new output restraint deal.</p><p><i>By Nader Itayim</i></p></article>
