OPEC oil cuts deal in trouble as Russia still not on board - Reuters

VIENNA (Reuters) - Russia will not back an OPEC call for extra oil output cuts and will only agree to extending existing curbs, a Russian source said on Friday, threatening to derail a plan by OPEC ministers for deeper reductions to cope with the coronavirus outbreak.

FILE PHOTO: The logo of the Organisation of the Petroleum Exporting Countries (OPEC) sits outside its headquarters ahead of the OPEC and NON-OPEC meeting, Austria December 6, 2019. REUTERS/Leonhard Foeger/File Photo

“That position won’t change,” the high-level Russian source told Reuters as ministers from OPEC, Russia and other producers, a group known as OPEC+, gathered for crunch talks at OPEC’s Vienna headquarters as the spreading virus has hit oil demand.

OPEC ministers had said on Thursday they backed an additional 1.5 million barrels per day (bpd) of oil cuts until the end of 2020, a much bigger and more extended move than expected, but they made the proposal conditional on Russia and other non-OPEC producers backing the curbs.

Russian Energy Minister Alexander Novak has not made any public statements about the proposed extra cuts during his trips to and from Vienna this week, although Moscow has long indicated it was uneasy about any further output reductions.

“There is a problem. OPEC has no intention to cut without Russia. We need to do something or the consequences will be drastic for everyone,” a source from a Gulf producer said.

An OPEC source confirmed that Russia had rejected a deeper cut proposal during informal consultations on Friday. The informal consultations have delayed the start of the formal OPEC+ meeting by almost three hours.

Iranian Oil Minister Bijan Zanganeh, whose country is a member of OPEC but exempted from any curbs, said OPEC was still working with Russia and other non-OPEC states to reach a deal, the SHANA news agency reported.

The proposed new cuts would be on top of existing curbs of 2.1 million bpd under an OPEC+ deal due to expire in March. OPEC ministers have called for extending that deal as part of a new pact, taking total supply reductions to about 3.6 million bpd.

Moscow’s decision not to back the additional curbs could undermine cooperation between the Organization of the Petroleum Exporting Countries and Russia, an informal alliance that has propped up oil prices since 2016.

Oil prices extended their decline after comment by the high-level Russian source with Brent prices falling as much as 5% to below $48 a barrel.

Prices lost more than a quarter of their value since the start of the year, as the global economic outlook darkened under the shadow of the coronavirus.

Additional reporting by Shadia Nasralla and Ahmad Ghaddar; Editing by Edmund Blair and Dmitry Zhdannikov

Our Standards:The Thomson Reuters Trust Principles.

Let's block ads! (Why?)

"oil" - Google News
March 06, 2020 at 03:42PM
https://ift.tt/2IlJXcB

OPEC oil cuts deal in trouble as Russia still not on board - Reuters
"oil" - Google News
https://ift.tt/2PqPpxF
Shoes Man Tutorial
Pos News Update
Meme Update
Korean Entertainment News
Japan News Update

Bagikan Berita Ini