OPEC, oil nations agree to nearly 10M barrel cut amid virus
DUBAI, United Arab Emirates (AP) — OPEC, Russia and other oil-producing nations on Sunday finalized an unprecedented production cut of nearly 10 million barrels, or a tenth of global supply, in hopes of boosting crashing prices amid the coronavirus pandemic and a price war, officials said.
The cartel and other nations agreed to allow Mexico to cut only 100,000 barrels a month, a sticking point for an accord initially reached Friday after a marathon video conference between 23 nations. They reached the deal just hours before Asian markets reopen Monday as international benchmark Brent crude traded at just over $31 a barrel and American shale producers struggle.
Oil prices have collapsed as the coronavirus and the COVID-19 illness it causes have largely halted global travel and slowed down other energy-chugging sectors such as manufacturing.
Mexico's energy minister said on Twitter that the group of nations agreed to cut 9.7 million barrels a day to begin May 1. Energy officials from other countries shared similar information.
Video aired by the Saudi-owned satellite channel Al-Arabiya showed the moment that Saudi Energy Minister Prince Abdulaziz bin Salman, a son of King Salman, assented to the deal.
“I go with the consent, so I agree,” the prince said, chuckling, drawing a round of applause from those on the video call.
But it had not been smiles and laughs for weeks after the so-called OPEC+ group of OPEC members and other nations failed in March to reach an agreement on production cuts, sending prices tumbling. Saudi Arabia sharply criticized Russia days earlier over what it described as comments critical of the kingdom, which finds itself trying to appease U.S. President Donald Trump, a longtime OPEC critic.
Even U.S. senators had warned Saudi Arabia to find...