Oil Producers to Discuss Fair Deal on Output Cut

Oil Prices Extend Gains on OPEC+ record output cuts

OPEC+ are working on a deal for an unprecedented oil production cut; equivalent to around 10% of worldwide supply, an OPEC source said.

US President called on Thursday for action to stop the sharp fall in oil prices due to the coronavirus outbreak.

Saudi Arabia also called for an emergency meeting of OPEC+, to stabilize the oil market.

The energy ministry of non-OPEC producer Azerbaijan, meanwhile, said the OPEC+ meeting is to be on April 6 and will be held as a video conference.

Trump said he spoke with both Saudi Crown Prince Mohammed bin Salman and Russian President Vladimir Putin on Thursday.

He said Saudi Arabia and Russia could cut output by 10 to 15 million bpd; an unprecedented amount representing 10% to 15% of global supply.

But Trump stressed he did not make any concessions to a US domestic production cut; a move forbidden by US antitrust legislation.

White House economic adviser Larry Kudlow said on Friday that the US administration cannot dictate decisions on oil production to American companies.

“I think… oil companies, seeing a decline in price are going to pull back on production. That’s just common sense,” he added.

“The US needs to contribute from shale oil,” an OPEC source said.

Russia has long expressed frustration that its joint cuts with OPEC were only lending support to higher-cost US shale producers.

Two OPEC sources also said a deal on reducing production must include producers from outside OPEC+.