OPEC, Russia Reach Deal to Cut Oil Production

Oil prices fall as traders fear reductions agreed to by OPEC and Russia will fail to offset biggest demand collapse in history.

David Sheppard, Anjli Raval, Derek Brower and Henry Foy, Financial Times
OPEC, Russia Reach Deal to Cut Oil Production

Saudi Arabia and Russia agreed between them to cut about 5 million bbl/d in oil production. (Source: Shutterstock.com)

OPEC and Russia agreed on April 9 to make deep cuts to oil production, ending a weeks-long market-share war that put further pressure on prices already reeling from the biggest demand collapse in history.

But the market reaction was punishing after details of the proposal—which by 9 p.m. in Vienna had not yet been formally agreed by OPEC ministers—emerged.

Global benchmark Brent reversed a near 11% rally to close down 4% at $31.48 a barrel. Traders doubted the cuts would make up for the fall in demand resulting from the coronavirus pandemic and questioned whether non-OPEC producers would contribute.

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