Oil Crashes After Reports OPEC+ Talsk End Without A Deal
Update (1015ET): Reports, citing a delegate, for the first time in six years, OPEC ends talks in Vienna without a deal. being agreed. Oil prices are extending their collapse…
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Update (0950ET): Bloomberg reports that OPEC+ talks “are on the verge of collapse” as it becomes clear that Russia will not agree (and in fact disagrees with their usefulness) to further production cuts, and in fact will not agree to extend the duration of the current production cuts.
WTI just hit a $42 handle…
Some context for just how bad this is…
And OPEC+ have been “managing” this for years?
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Update (0815ET): Russia says it is ready for a decline in oil prices. It said OPEC+’s proposed deeper production cuts aren’t a solution to rebalancing the global oil market amid a collapse in demand.
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Brent crude futures tumbled by more than 4% on Friday after Reuters reported that Russia had rejected steep production cuts by OPEC to prop up oil prices amid the Covid-19 outbreak triggering demand shocks in China and across the world.
A high-level Russian source told Reuters that Moscow has no interest in backing an OPEC reduction that calls for extended cuts and would only agree to existing cuts that OPEC already agreed on.
OPEC has held several days of talks in Vienna, Austria, backing an additional 1.5 million barrels per day (bpd). However, it has failed to bring Russia on board. OPEC wants non-OPEC to contribute 500,000 bpd to the overall cut. The new deal would mean OPEC+ would cut a total of 3.6 million bpd, a move that would hopefully lead to a rebalancing in the global oil market in the second half of the year. On Russain disappointment, Brent crude futures dropped to its lowest level since July 2017, trading at $47.70 a barrel, or down 4.5% on Friday morning.
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