The oil cartel Opec has started on Saturday in talks on a possible extension of their current funding cuts.
The large oil-producing countries want to stop the price decline in the Corona-crisis. After the internal vote, the oil cartel wants to speak with its cooperation partners, the so-called Opec+,.
In the Video conversations between the cartel and the Russian-led group, it is primarily a question of whether a two months ago agreed agreement to curb Oil production should be extended. From the Russian side, it was in the run-up, it will be a “long and difficult night”.
“These changes have brought to the market the much-needed relief, and we have experienced a cautious recovery,” said the Algerian energy Minister and President of the Opec conference, Mohamed Arkab, from the beginning of the talks on Saturday. “The prospects for both supply and demand have improved in the past few weeks.” The countries involved had so far maintained a high degree of agreement.
The organization of petroleum producing countries (Opec) and other countries had agreed in April to reduce the Oil production of 9.7 million barrels (each 159 litres) on the day for the months of may and June. The Opec is expected because of the economic consequences of the Corona-crisis to a sharp fall of oil Consumption. A reduction to the fallen prices to rise again.
Market observers expect an agreement. However, the Opec does not want to drive the prices also very high. The US could bring competition back into the game, which could produce at prices beyond the $ 40 a Barrel again, to cover costs.
With a sharp increase in Oil prices, Opec would dig their own graves, – said Commerzbank expert Eugen Weinberg. Countries that have produced in the past month more than they should, have pledged their commitments in the future to comply with, he said, with reference to Iraq, Nigeria, Angola and Kazakhstan.
Nigeria reiterated at the beginning of the talks, his willingness to comply with the agreement. Countries that are not able to, the agreement during the current two-month deadline, should compensate for this within the following three months, informed the competent Ministry.