OPEC meeting schedules production cuts
OPEC and associated countries entered negotiations concerning new oil production cuts. The organization is planning to reduce the output by around 15 million barrels daily, which equals to 15% of global production.
The preliminary plan also includes reduction of the oil production in the countries, which are not members of OPEC+ by around 5 million bpd. The organization aims to use it to placate the United States.
Negotiations have been hindered by tensions between OPEC Saudi Arabia and Russia - the biggest oil producers in the world. However, according to insider sources, the countries have managed to reach compromise. One of Russian representatives has stated, that they are expecting other producers to join the effort “which might happen tomorrow”.
The OPEC negotiations will be followed by a meeting of energy officials of G20. The meeting is hosted by Saudi Arabia.
The meeting has become a cause for optimism on the oil market. Major indexes have gone up after hitting their lowest levels in the last 18 years.
The cuts of 10 million to 11 million barrels per day are scheduled to start May.