Saudi Arabia called for an urgent meeting of OPEC

US, WASHINGTON (ORDO NEWS) — OPEC + countries must urgently hold an extraordinary meeting to reach a fair agreement to restore the oil market, the Saudi press agency said in a statement.

File Reuters

Following this announcement, June Brent futures on the London-based ICE exchange rose by 46.7% at the peak , to $ 36.29 per barrel.

At the same time, over the past three months, under the influence of various factors – from the breakdown of the OPEC + transaction to the epidemic of coronavirus and a drop in oil demand – the price of Brent fell to $ 25 per barrel (and at the peak of the drop it fell $ 22 per barrel to the level of March 2002).

Russian Energy Minister Alexander Novak, in an interview with Ekho Moskvy radio station, said that the Ministry of Energy and oil companies expect a worsening market situation – in the coming weeks, world oil demand may fall by 20 million barrels per day.

According to Novak, in the current situation it is not advisable to increase production, both the Ministry of Energy and Russian companies adhere to this opinion. He added that a number of countries also announced their intention not to increase production.

The OPEC + deal, which was held at the agreement of Russia and Saudi Arabia for three years and allowed to stabilize oil prices at $ 60 per barrel by limiting production, was completed on March 31, 2020. It was not possible to extend it due to the opposing positions of the two largest participants: Russia proposed to extend the agreement on the same terms and only for the second quarter of 2020, and Saudi Arabia – to increase the reduction by 1.5 million barrels per day until the end of the year. The termination of the agreement led to a sharp drop in oil prices, which was exacerbated by a decline in global demand due to the pandemic of the disease caused by the new coronavirus.

At the same time, US President Donald Trump expressed confidence that Russia and Saudi Arabia will at some point come to an agreement on the situation on the oil market.

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