OPEC Invites U.S. Oil Official To Production Cut Meeting

OPEC will invite the U.S. oil regulator to take part in the emergency OPEC+ video meeting on Monday, a source involved in the preparation of the meeting told Russian news agency TASS on Friday.

The OPEC+ group of producers will meet online on April 6 to discuss a possible massive production cut of around 10 million bpd, according to several media reports.

However, the OPEC+ coalition would likely want all major producers in the world to take part in a collective cut, including producers such as the United States, Canada, Brazil, or Norway.

On Thursday, OPEC’s top producer and de facto leader Saudi Arabia called for the emergency meeting of OPEC+ and “another group of countries” to try to find “a fair solution” to the current market imbalance, after U.S. President Donald Trump said that he hoped and expected that Saudi Arabia and Russia would “cut back approximately 10 Million Barrels, and maybe substantially more.”  

President Trump hasn’t mentioned any involvement of the U.S. in possible cuts, but he is scheduled to meet oil executives later on Friday and over the weekend to discuss the collapse of the oil prices and the subsequent impact on U.S. shale producers.

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Texas Railroad Commissioner Ryan Sitton discussed on Thursday the state of the oil market and the prospect of taking 10 million bpd off the markets with Russian Energy Minister Alexander Novak. 

Last month, Sitton spoke with OPEC’s Secretary General Mohammad Barkindo and said that “we all agree an international deal must get done to ensure economic stability as we recover from COVID-19. He was kind enough to invite me to the next OPEC meeting in June.”

According to analysts, first, a deal involving the U.S. would be difficult to reach, and second, even 10 million bpd may not be able to erase the glut as global demand is currently falling by 20 million bpd and even more due to the widespread lockdowns around the world.  

By Tsvetana Paraskova for Oilprice.com

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