Dec. 27 (Bloomberg) -- Ecuadorean President Rafael Correa has ordered Italian oil company Agip to suspend production in Ecuador as the country moves to meet the output reduction agreed to by Organization of Petroleum Exporting Countries.

In his regular Saturday radio and television broadcast, Correa also today said that Ecuador is losing money on its contract with the Italian company, a unit of Eni SpA.

“That way it will be easy to eliminate more than 20,000 barrels, of the 40,000 we have to reduce,” Correa said, adding that other foreign companies he didn’t name will also have to cut production.

OPEC, supplier of more than 40 percent of the world’s oil, on Dec. 17 agreed to reduce its joint output by nine percent starting in January, cutting Ecuador’s daily quota to 449,000 barrels from the previous 493,000. The South American country produced an average 505,000 barrels per day last month.

To contact the reporter on this story: Stephan Kueffner in Cuenca at skueffner@bloomberg.net

Last Updated: December 27, 2008 15:48 EST