Hours before the start of key talks between OPEC, Russia and other oil producers over efforts to prop up prices, a Russian source and an OPEC source told Reuters on Thursday Saudi Arabia and Russia still need to resolve differences over plans for deep output cuts.
“I’m not sure how Russia and Saudi Arabia would be able to iron out their differences today, it all could be stretched out,” the Russian source told the news agency.
Two Russian sources said the maximum Russian oil production cut under any global pact on supplies would be 2 million barrels per day (bpd).
The talks, crucial for oil markets hammered by the coronavirus crisis, are complicated not only by internal disagreements, but also the reluctance of the United States to join in any action, Reuters writes.
Global fuel demand has plunged as much as 30% as measures to fight the virus have grounded aircraft, reduced vehicle usage and curbed economic activity.
Benchmark Brent crude oil prices LCOc1 hit an 18-year low last month and are trading around $34 a barrel, half their level at the end of 2019, dealing a severe blow to budgets of oil-producing nations and high-cost U.S. shale oil industry. [O/R]
U.S. President Donald Trump said last week a deal he had brokered with OPEC leader Saudi Arabia and Russia could lead to cuts of 10 million to 15 million barrels per day (bpd), or 10% to 15% of global supplies, an unprecedented reduction. But Washington has yet to show it is ready to take part.
Kremlin spokesman Dmitry Peskov said a new deal on output cuts was “hardly possible” without others participating.
