Why Has Saudi Arabia Cut Its Oil Output?

Saudi Oil Minister Ali al-Naimi addresses the XII International Arab Conference on Mineral Resources in Sudanese capital Khartoum, on November 27, 2012.

The world's most influential oil producer, Saudi Arabia, reduced its oil production towards the end of 2012, causing many to conclude the Kingdom sought to reinforce global oil prices, but the Internal Energy Agency has a different take.

Saudi Arabia had been pumping oil at 30-year highs for most of 2012, but cut back supplies by just below 300,000 barrels per day in December to 9.36 million b/d, the IEA said in its most recent Monthly Oil Market Report.

Many analysts and news agencies noted the cutback, proclaiming it was driven by price considerations, with the Saudis looking to ensure they received adequate revenue from oil exports to finance the government's budget, a move Riyadh is widely believed to have made in the past.
Why Has Saudi Arabia Cut Its Oil Output?