Saudi, Russia closing in on record oil cut deal
OPEC and it allies held talks on Thursday on record oil output curbs of 15 million to 20 million barrels per day (bpd), or 15% to 20% of global supplies, to support prices hammered by the coronavirus crisis, OPEC and Russian sources said, Trend reports citing Reuters.
They said the cuts included contributions of up to 5 million bpd from producers outside their group known as OPEC+ and could be made gradually, potentially overcoming resistance from the United States, whose involvement is seen as vital to win broad backing for an agreement.
Talks have been complicated by friction between OPEC leader Saudi Arabia and non-OPEC Russia, two of the world’s biggest oil producers. But OPEC sources and a senior Russian official said they had managed to overcome their differences.
Global fuel demand has plunged by as much as 30 million bpd, 30% of global supplies, as measures to fight the coronavirus have grounded aircraft, reduced vehicle usage and curbed economic activity. So even a 20 million bpd cut falls short.
“That is a global deal,” one OPEC source said as the Organization of the Petroleum Exporting Countries, Russia and others which make up the OPEC+ group held a video conference.
Three OPEC+ sources said the group wanted non-members such as the United States, Canada, Norway and Brazil to contribute 5 million bpd to the overall cut, with OPEC+ would add at least another 10 million to 12 million bpd.