Saudi Arabia’s additional voluntary cuts of 1.18 million barrels of oil (mmbbl/d) carried out in June will not be continued into July as global oil demand begins to recover, according to Reuters.

Saudi’s Energy Minister Prince Abdulaziz bin Salman announced that Saudi Arabia, Kuwait and the UAE will not continue to additionally cut 1.18 mmbbl/d in July (of which Saudi forfeited 1 mmbbl/d), stating that they will stick to the agreed OPEC quota in July. 

However, despite the extension of record oil cuts in July, the curtailing of the Gulf’s voluntary cuts has resulted in a global oil price crash of 3%

“The voluntary cut has served its purpose and we are moving on. A good chunk of what we will increase in July will go into domestic consumption,” Prince Abdulaziz told an OPEC+ virtual news conference.

Saudi maintains that the excess crude from not renewing the voluntary cuts will go towards domestic consumption which usually increases in the hot summer months. 

The OPEC+ supply cuts are schedule to last until April 2022 but at a lower level after July.