OPEC after a marathon video-conference, which ended in the early hours of Friday, somewhat ended without a definitive decision.
The proposal calls for a cut in production of 10 million barrels per day until July, then an eight million barrels per day cut until the end of the year.
Starting in 2021, a reduction of six million barrels per day will last for 16 months.
Opec has said a proposed deal to cut global oil production “is conditional on the consent of Mexico”. Both Saudi Arabia and Kuwait did blame Mexico for endangering the proposal according to reports.
There were some recent comments from Kuwait’s Oil Minister Khaled al-Fadhel suggesting that the deal was not yet done. He said:
“At the meeting for the Opec group that ended at 3am, Mexico disrupted the agreement of all the countries to reduce the production of oil by 10 million barrels a day,”
Oil prices on Thursday, after starting the day firmly in positive territory on much optimism, given the failure to agree on something solid and being a right mess of a situation, prices sold off hard towards the close. Looking specifically at WTI crude oil, it closed down a chunky 11%, falling back down to its lowest in over a week. If things continue to remain uncertain with an actual deal, then expect prices to be further hammered when trading resumes next week, after the Easter break.
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