Saudi Arabia intends to propose an additional cut of 1 million barrels of oil per day at the next meeting of the parties to the OPEC+ deal, as concerns around the coronavirus disease continue to undermine oil demand forecasts, the Financial Times reported on Friday, citing five sources familiar with the matter
MOSCOW (Pakistan Point News / Sputnik - 28th February, 2020) Saudi Arabia intends to propose an additional cut of 1 million barrels of oil per day at the next meeting of the parties to the OPEC+ deal, as concerns around the coronavirus disease continue to undermine oil demand forecasts, the Financial Times reported on Friday, citing five sources familiar with the matter.
The outbreak of coronavirus this winter sparked expectations of a slowdown in oil demand. As a result, Brent futures fell from a peak $71.75 per barrel in January to a 13-month low of $50.12 per barrel on Friday. On February 12, OPEC downgraded its 2020 global oil demand growth forecast by almost 20 percent to 990,000 barrels per day.
Saudi Arabia's most recent proposal calls for bigger cuts than previously discussed, the newspaper said.
According to the Financial Times' sources, Saudi Arabia is ready to take on the bulk of new cuts, while the remaining reductions will be distributed between Kuwait, the United Arab Emirates and Russia.
The current market situation was discussed at an extraordinary meeting of the OPEC+ technical committee in early February. The cartel's experts then recommended extending the oil output cut deal until the end of the year, proposing even larger cuts at least through the second quarter. Saudi Arabia had reportedly lobbied for a reduction of at least 600,000 barrels per day at the time.
Further changes to the OPEC+ deal are expected be agreed at the group's ministerial meetings on March 5 and March 6 in Vienna.
