In an effort to stabilize oil prices, several OPEC+ countries have agreed to voluntarily cut oil production by a total of 2.2 million barrels per day in the first quarter of 2024, the oil-producing group announced on Thursday. Saudi Arabia, the world's largest exporter of crude oil, will lead the way by extending its voluntary production cut of 1 million barrels per day by an additional three months.

According to a statement from OPEC+, which consists of the Organization of the Petroleum Exporting Countries and its allies, Saudi Arabia's production will remain at approximately 9 million barrels per day until the end of March 2024. The decision came after Saudi officials met with other major oil-producing nations in Vienna on Thursday.

Other OPEC+ members also announced their voluntary production cuts. Russia will reduce production by 500,000 barrels per day, Iraq by 223,000, the United Arab Emirates by 163,000, Kuwait by 135,000, Kazakhstan by 82,000, Algeria by 51,000, and Oman by 42,000, as stated by OPEC+.

During the meeting, it was also revealed that Brazil, another significant oil producer, will join OPEC+ at the beginning of next year. The specifics of Brazil's participation in shared production quotas are still unclear and will depend on a technical review of the cooperation charter.

Following the announcement, oil prices experienced a slight decline. Brent crude, the global oil benchmark, settled down 0.3% at $82.83 a barrel, while West Texas Intermediate crude, the US benchmark, settled down 2.3% at $75.96 a barrel. Prior to the meeting, the contracts were trading around $84 and $79, respectively.

Media reports citing unnamed OPEC+ sources suggest that the delay in the announcement was due to disagreements over the production levels of certain members and the associated cuts.

Despite previous commitments to reduce output by 3.66 million barrels per day until the end of 2024, along with additional voluntary cuts by Saudi Arabia and Russia, Brent and WTI prices have fallen by approximately 13% and nearly 16% since their peak in late September.

The decline in prices can be attributed to record crude oil production in the United States and concerns regarding dwindling global demand, especially in China, the world's largest oil importer. As OPEC+ takes steps to address these challenges, the impact on oil markets remains to be seen.