In its monthly report published on Wednesday, OPEC reduced the growth in world demand for oil from 990,000 barrels per day to 60,000 bpd, a 93 per cent drop, Efe news reported. The initial six-month OPEC-plus deal was then extended several times.
Murphy telling NEWS 95.7 Saudi Arabia may still increase oil production.
However, a few days ago, the kingdom's policy changed completely when Russian Federation refused to go along with deeper cuts. That followed the U.S. Department of Energy denouncing "attempts by state actors to manipulate and shock oil markets".
The announcement - coming in the middle of unprecedented volatility in global energy markets - was preceded by a brief suspension of its shares on the Tadawul, at its own request, as is required when a listed company is about to announce a "material event".
Of course, oil markets have been slammed all week after Saudi Arabia said it would raise production in a standoff with Russian Federation. We are dealing with a number of factors that led to a significant reduction in the price for oil and energy products. As recently as July, Russia and Saudi Arabia touted their alliance as a marriage to "eternity".
Saudi Arabia is a member of the Organization of Petroleum Exporting Countries, or OPEC.
Over the weekend, Aramco cut its official selling prices by the biggest amount in more than three decades.
It is also hard to say that prospects for Saudi-Russian investment cooperation are bright.
Their partners from Saudi Arabia, meanwhile, don't seem so open to further communication.
The tactic has already started to pay off, with refiners ordering extra volumes of its crude for loading in April at "very attractive prices", the sources added.
The deputy minister sees oil market equilibrium at $45-55 per barrel, which is comfortable for producers and low enough for the global economy to recover from the coronavirus impact.
Oil prices dropped as much as 8% on Thursday as crude continues to take a hit on both the supply and demand side. When Moscow refused, OPEC said all limits would be scrapped. It will try to do its best to prepare for this.
The Gulf producers are throwing open the oil taps as part of a price war offensive unleashed by Saudi Araba after Russian Federation refused to back deep output cuts to blunt waning demand as the coronavirus slows business around the globe. "That's what happens. When budgets are cut, new drilling goes first". Consequently, the Kremlin simply decided not to accept the deepening of the cuts at all, thus, showing that its honeymoon with Saudi Arabia is, at least temporarily, over.
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