Algeria says has implemented OPEC oil cut

ALGIERS (Reuters) - Algeria has cut oil production in line with OPEC policy aimed at propping up sagging prices, the north African country's energy and mines minister said on Saturday, according to the official APS news agency.

"Algeria has put into effect the reduction of its production in conformity with the quota that it has been assigned by the Organization of the Petroleum Exporting Countries," the agency quoted the minister, Chakib Khelil, as saying.

The agency said Algeria was required to reduce its output to 1.2 million barrels per day (bpd) under an agreement reached at a meeting of OPEC producers in Algeria last month.

The agency said that as a result of the application of the agreement by OPEC member countries, oil markets would stabilise between now and the end of the second quarter of 2009, before reviving from the third quarter onwards as demand picked up.

Khelil cited a Reuters survey showing OPEC output had fallen in December for the fourth consecutive month as evidence that OPEC members had fulfilled their obligations under the agreement, APS reported.

The survey of oil companies, OPEC officials and analysts showed that supply from the group fell to 30.6 million barrels per day (bpd) in December from 30.75 million bpd in November.

The 11 members bound by output targets pumped 27.36 million bpd, down from 27.62 million bpd in November and close to their December target of 27.3 million bpd, the survey found.

That means the group has met virtually all of its pledge to lower supply to 27.3 million bpd from November 1.