Saudi-Russia’s “unclear recovery path”
Oil price rally on news of freezing of production cuts
[뉴욕=뉴스핌] Correspondent Kim Min-jung = OPEC+, an alliance of 10 non-member countries including the Organization of Petroleum Exporting Countries (OPEC) and Russia, has decided to maintain the scale of production cuts in April, Reuters reported, citing multiple sources on the 4th (local time).
Saudi Arabia, which is currently reducing production by an additional 1 million barrels per day, has put weight on the plan to continue production cuts next month.
Reuters, citing two sources, said that OPEC+ has agreed to maintain oil production in general. Sources explained that Russia and Kazakhstan could gradually increase oil production according to an agreement.
OPEC+ is scheduled to meet again next month to determine oil production in May and beyond.
Reuters also reported that Saudi Arabia is considering extending production cuts of 1 million barrels per day, which was carried out from last month to this month.
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| OPEC headquarters in Vienna, Austria.[사진=로이터 뉴스핌] 2020.11.24 [email protected] |
It is reported that Saudi Arabia and Russia have diagnosed that the recovery of the oil market is still in jeopardy and are leaning toward such a decision.
Saudi oil minister, Prince Abdulaziz bin Salman, said on the day that “the uncertainty surrounding the speed of (oil market) recovery has not disappeared.”
Russia’s Vice Prime Minister Alexander Novak diagnosed that the oil market has not fully recovered and that the new coronavirus infection is still creating uncertainty.
OPEC+ cut production by 9.7 million barrels per day as demand for crude oil collapsed amid the new coronavirus infection (Corona 19) pandemic. However, as oil prices rose in anticipation of economic improvement, the scale of production cuts was reduced to 7.2 million barrels a day from last January.
Oil prices rallied on the news of the agreement to freeze oil production that day. West Texas crude oil (WTI) for April delivery rose 2.85 dollars (4.7%) per barrel to 64.13 dollars from the previous day, and the international benchmark Brent crude oil May rose 3.04 dollars (4.7%) to 67.11 dollars.