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OPEC agrees with partners to reduce oil production
The | Reading time: 2 minutes.
Russia, the United States and Saudi Arabia support the agreement with OPEC
Source: Getty Images
In a special session on Sunday night, the participating oil-producing countries agreed with OPEC to cut 9.7 million barrels (159 liters each) per day for May and June. The production cut corresponds to around ten percent of daily oil production worldwide.
DThe path for a historically unique strangulation of oil production by the OPEC oil cartel and its partners is free. In a special video session on Sunday night, the oil-producing countries involved agreed to a reduction of 9.7 million barrels (159 liters each) per day during the months of May and June, as Mexican energy minister Rocio wrote Nahle on Twitter. The Kazakh Ministry of Energy also confirmed the agreement, according to the Kazakh agency Tengrinews and the Russian agencies.
The amount is around 300,000 barrels per day below the original target decided on Friday. Mexico had refused to contribute the 400,000 barrels required to the end and held on to its offer to remove 100,000 barrels from production. The production cut corresponds to around ten percent of daily oil production worldwide. Other countries such as Canada and the United States are expected to reduce production.
Russian President Vladimir Putin telephoned his American colleague Donald Trump at night, as the Kremlin said. Russia, the United States and Saudi Arabia, therefore, support the agreement. The limitation could “stabilize world markets and ensure the sustainability of the global economy as a whole.” Talks about this should continue, he said. Putin also spoke to King Salman of Saudi Arabia.
Production volume in October 2018 as initial level
Initially it was unclear whether the round also confirmed targets for the period through April 2022. The round called the Saudi Arabian heavyweight, called Opec +, agreed on Friday to reduce production by eight million barrels of oil daily from July to December. Between January 2021 and April 2022, the daily production cut should amount to six million barrels. The production level was established in October 2018, and Saudi Arabia and Russia have their own starting level of 11 million barrels per day.
With the cut, OPEC + wants to stabilize the price of oil, which has fallen rapidly in the crown crisis. It is not yet clear if the decision will cause gas stations to increase gasoline prices again.
