Mar 5, 2020 - Energy & Environment

OPEC puts the ball in Russia's court on oil production amid coronavirus spread

Minister of Energy of Saudi Arabia, Abdulaziz bin Salman Al Saud

Saudi Energy Minister Abdulaziz bin Salman Al Saud in Vienna on March 5. Photo: Askin Kiyagan/Anadolu Agency via Getty Images

OPEC ministers have agreed to push for deepening their joint production-cutting agreement with Russia and allied producers by 1.5 million barrels per day, per reports from Vienna.

Why it matters: The cartel is trying to grapple with how the novel coronavirus is sapping oil demand and depressing prices.

  • All eyes are now on Russia, which has yet to endorse the plan. Per Bloomberg, OPEC officials are "gambling that they can overcome Russian opposition that could block the move."

Where it stands: The latest sign of coronavirus' effect on the market came this morning. The consultancy Wood Mackenzie estimated global oil demand this quarter will fall by 2.7 million barrels per day compared to a year earlier.

  • It's among several estimates that show the economic hit from the virus not only slowing oil demand but throwing it into reverse.

Go deeper: Fueled by coronavirus, global oil demand set to drop record amount

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