Jun 1, 2020 - Energy & Environment

OPEC+ eyes extension of oil production cuts

OPEC building in Vienna

OPEC conference at Vienna in March 2020. Photo: Askin Kiyagan/Anadolu Agency via Getty Images

OPEC+ members are in talks to lengthen current crude oil output curbs instead of loosening the restrictions as envisioned in their April agreement, per reports in Bloomberg and Reuters.

Driving the news: The OPEC+ group — which includes OPEC, Russia and allied producers — are eyeing an extension of the 9.7 million barrels per day production cut for one or two months, Reuters reported. Bloomberg notes it could be three.

  • Right now the cutbacks are slated to begin easing at the end of June, dropping to 7.7 million for the rest of the year.

The big picture: The formal cuts in the agreement are part of a much larger global decline in response to the pandemic that caused demand and prices to crater.

  • Demand has begun coming back and prices have rallied in recent weeks, but the market is still facing headwinds and lots of uncertainty.

What's next: The OPEC+ group's planned meeting next week could be moved up to this Thursday, per multiple reports.

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