OPEC agrees to the largest reduction in oil production since 2008 – Economy – Arab and International


Two OPEC sources said that the organization agreed today to cut production by an additional 1.5 million barrels per day in the second quarter of 2020 to support prices in light of the outbreak of the Corona virus, but it made it conditional on Russia joining.
The outlook for oil demand was hit hard by the measures to contain the virus, disrupting factory activities and prompting reluctance to travel and curbing other business activities. The prospect of oil demand growth in 2020 shrinks, prompting OPEC to consider its biggest cut since the 2008 financial crisis.
Saudi Arabia has proposed that OPEC and its allies, including Russia, be reduced by up to 1.5 million barrels per day in the second quarter with extending current cuts of 2.1 million barrels per day, which expires this month, until the end of 2020. Until now, Russia has hinted at its intention to support Extend the cut not deepen.
In the past, Moscow, which has been cooperating on production policy since 2016 as part of an informal group known as “OPEC +”, expressed hesitation during the negotiations, but was participating in the last moments.
Two OPEC sources said that Russia is open to deepening the cuts, not just extending them, but Moscow has not yet commented.
Earlier, sources from «OPEC» indicated that the initial talks with Russia this week in Vienna are more difficult than before.
When asked what would happen if Russia refused to join the new cut when the “OPEC” and Russia and other producers from outside it met on Friday, an OPEC source said: “The worst scenario is (just) the extension.”




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