OSLO (Reuters) - Western Europe’s largest oil and gas producer Norway said on Saturday it would consider cutting its oil production if a global deal to curb supply is agreed by the world’s biggest producers.
OPEC and its allies are working on a deal for an oil output cut equivalent to about 10% of world supply in what member states expect will be an unprecedented global effort including the United States.
Washington, however, has yet to make a commitment to join the effort.
Oil prices have shed two thirds of their value in the first quarter of the year, pummelled by a drop in demand due to coronavirus lockdowns and after Russia and Saudi Arabia failed to agree on further output cuts.
The price of North Sea oil touched an 18-year low of $21.65 a barrel on March 30. It has since recovered to more than $30 a barrel on hopes of a new global oil output deal.
“If a broad group of producers agree to cut production significantly, Norway will consider a unilateral cut if it supports our resource management and our economy,” Norwegian Oil and Energy Minister Tina Bru said in an email to Reuters.
She said Norway had been in a dialogue with other oil producing countries, without elaborating on a potential size of the output cut.
Norway, which meets about 2% of global oil demand, is not a member of OPEC. It has cut its oil output several times before, including in 1990, 1998 and in 2002, always in tandem with other producers when prices fell.
During the first half of 2002, Norway cut its output by around 150,000 bpd after oil prices fell to below $20 a barrel following attacks in the United States on Sept. 11, 2001.
Norway’s crude oil production stood at 1.75 million barrels per day (bpd) in February, up 26% from a year ago thanks to the ramp-up of state-controlled Equinor’s giant Johan Sverdrup oilfield.
Equinor said on March 30 it expected Sverdrup, Western Europe’s largest oilfield, to hit a daily output of 470,000 bpd in early May, up from around 350,000 bpd at end-2019.
Norway’s crude oil production peaked in 2001 before declining somewhat. It has been rising again since 2014, with most of its oil being exported to Britain and other European countries.
Aside from Equinor, other companies producing oil off Norway include Aker BP, ConocoPhillips, Lundin Energy, Eni’s subsidiary Vaar Energi, Shell, Total, OKEA and DNO.
Reporting by Nerijus Adomaitis; Editing by Gwladys Fouche and Christina Fincher