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Saudi Energy Minister Sees Potential Extension to Oil Cuts Until 2022

Saudi Energy Minister Prince Abdulaziz bin Salman. Asharq Al-Awsat
Saudi Energy Minister Prince Abdulaziz bin Salman. Asharq Al-Awsat
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Saudi Energy Minister Sees Potential Extension to Oil Cuts Until 2022

Saudi Energy Minister Prince Abdulaziz bin Salman. Asharq Al-Awsat
Saudi Energy Minister Prince Abdulaziz bin Salman. Asharq Al-Awsat

Saudi Energy Minister Prince Abdulaziz bin Salman revealed that further cooperation between oil producing countries could lead to the extension of the OPEC+ agreement until the end of 2022.

Oil markets still have not exited from the “coronavirus tunnel” and the OPEC+ production cut deal may extend to the end of 2022, the minister said in statements broadcast on television on Thursday.

He said that a meeting by the Joint Ministerial Monitoring Committee (JMMC) will be held every month until the oil market sees a full recovery from the pandemic.

“The deal will continue until April 2022, it’s clearly mentioned in the agreement that a further meeting to be held in December (2021) to discuss the need of extending the deal until the end of 2022,” he said.

He stressed the importance of compliance with agreed quotas from all members, adding that without compliance, countries that fulfilled their commitments may not agree to cut their production subsequently.

The minister described the decision that the Kingdom has taken last March after the collapse of OPEC+ negotiations to extend the oil cuts as "tough but the right decision."

He expressed satisfaction towards the last meeting, saying that some non-committed states had given serious promises. The energy minister also praised the Iraqi government for the cooperation it displayed, in addition to efforts exhibited by Kazakhstan and even Russia which slashes its production by 2.5 million barrels.

The minister said that Russia had helped the organization a great deal and that there is political and sovereign support for the cuts.

In other news, Saudi Arabia's total oil exports, including crude and oil products, fell to 7.48 million barrels per day (bpd) in May from 11.34 million bpd in April, official data showed on Thursday.

Monthly export figures are provided by Riyadh and other members of OPEC to the Joint Organizations Data Initiative (JODI), which publishes them on its website.

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Trump Exempts Mexico Goods from Tariffs for a Month, but Doesn’t Mention Canada

Construction workers are seen on the site of a new development in Long Beach, California, March 5, 2025. (AFP)
Construction workers are seen on the site of a new development in Long Beach, California, March 5, 2025. (AFP)
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Trump Exempts Mexico Goods from Tariffs for a Month, but Doesn’t Mention Canada

Construction workers are seen on the site of a new development in Long Beach, California, March 5, 2025. (AFP)
Construction workers are seen on the site of a new development in Long Beach, California, March 5, 2025. (AFP)

US President Donald Trump on Thursday said Mexico won't be required to pay tariffs on any goods that fall under the United States-Mexico-Canada Agreement on trade until April 2, but made no mention of a reprieve for Canada despite his Commerce secretary saying a comparable exemption was likely.

"After speaking with President Claudia Sheinbaum of Mexico, I have agreed that Mexico will not be required to pay Tariffs on anything that falls under the USMCA Agreement," Trump wrote on Truth Social. "This Agreement is until April 2nd."

Earlier on Thursday, US Commerce Secretary Howard Lutnick said the one-month reprieve on hefty tariffs on goods imported from Mexico and Canada that has been granted to automotive products is likely to be extended to all products that comply with the US-Mexico-Canada Agreement on trade.

Lutnick told CNBC he expected Trump to announce that extension on Thursday, a day after exempting automotive goods from the 25% tariffs he slapped on imports from Canada and Mexico earlier in the week.

Trump "is going to decide this today," Lutnick said, adding "it's likely that it will cover all USMCA-compliant goods and services."

"So if you think about it this way, if you lived under Donald Trump's US-Mexico-Canada agreement, you will get a reprieve from these tariffs now. If you chose to go outside of that, you did so at your own risk, and today is when that reckoning comes," he said.

Nonetheless, Trump's social media post made no mention of a reprieve for Canada, the other party to the USMCA deal that Trump negotiated during his first term as president.

Lutnick said his "off the cuff" estimate was that more than 50% of the goods imported from the two US neighbors - also its largest two trading partners - were compliant with the USMCA deal that Trump negotiated during his first term as president.

Canadian Prime Minister Justin Trudeau called Lutnick's comments "promising" in remarks to reporters in Canada.

"That aligns with some of the conversations that we have been having with administration officials, but I'm going to wait for an official agreement to talk about Canadian response and look at the details of it," Trudeau said. "But it is a promising sign. But I will highlight that it means that the tariffs remain in place, and therefore our response will remain in place."

Lutnick emphasized that the reprieve would only last until April 2, when he said the administration plans to move ahead with reciprocal tariffs under which the US will impose levies that match those imposed by trading partners.

In the meantime, he said, the current hiatus is about getting fentanyl deaths down, which is the initial justification Trump used for the tariffs on Mexico and Canada and levies on Chinese goods that have now risen to 20%.

"On April 2, we're going to move with the reciprocal tariffs, and hopefully Mexico and Canada will have done a good enough job on fentanyl that this part of the conversation will be off the table, and we'll move just to the reciprocal tariff conversation," Lutnick said. "But if they haven't, this will stay on."

Indeed, Trudeau is expecting the US and Canada to remain in a trade war.

"I can confirm that we will continue to be in a trade war that was launched by the United States for the foreseeable future," he told reporters in Ottawa.