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Data: Investing.com; Chart: Axios Visuals

Oil prices rose after news of a production cut agreement between the world's largest producers, but experts warn the move will not be enough to sustainably hold up prices or change the industry's bleak trajectory.

Driving the news: Crude futures jumped about 5% to near $25 a barrel for WTI crude after the OPEC+ alliance agreed to a 10 million barrels-per-day production cut beginning in May that ended a price war between Saudi Arabia and Russia.

  • However, the COVID-19 outbreak has slammed demand to that point that experts believe a cut of 20 million to 30 million barrels per day will be needed to offset the loss in the roughly 100 million barrel-per-day market.

Why it matters: With oil prices expected to continue their fall, a tidal wave of bankruptcies, defaults and closures of U.S. oil-and-gas companies is likely in the coming weeks and months that will weigh on bond and equity markets as well as the broader economy.

What's happening: Almost 40% of oil and natural gas producers face insolvency within the year if WTI crude prices remain near $30 a barrel, according to a new survey from the Kansas City Fed.

  • Even if oil prices rise to $40 a barrel — a nearly 40% jump from their current level — the percentage of firms expected to fall into insolvency only declines to 36%.
  • The Kansas City Fed's survey mirrored results from the Dallas Fed last month.

Word on the street: "I don't know of any companies that can operate profitably at [$40 per barrel]," said one respondent to the Kansas City Fed's survey.

Yes, but: "Oil majors proved resilient to extreme price volatility during the last oil price crash and they have already announced similar measures to protect their cash flows during the current crisis," Moody's Investors Service said in a recent note.

Be smart: Energy companies are the biggest issuers of junk bonds, accounting for more than 11% of the U.S. high yield market.

  • Even though the Fed has moved into purchases of some high yield bonds, much of the energy sector is highly levered and unlikely to meet standards for rescue from the central bank's ever-expanding world of asset purchases.

What to watch: Goldman Sachs analysts said they expect WTI crude prices will fall to $20 a barrel as downside risks overwhelm the near-term boost to sentiment.

  • “Ultimately, the size of the demand shock is simply too large for a coordinated supply cut, setting the stage for a severe rebalancing."

Go deeper: A world locked down and drowning in oil

Go deeper

4 mins ago - Health

Johnson & Johnson says booster shot increases efficacy of COVID vaccine

Syringes and a vial of the Johnson and Johnson COVID-19 vaccine in French Polynesia on Sept. 8. Photo: Jerome Brouillet/AFP via Getty Images

Johnson & Johnson said in a press release Tuesday a global study showed that the protection offered by its coronavirus vaccine was strengthened by a booster shot.

Why it matters: While J&J has not formally applied for authorization to offer booster shots to the general public, it said it has shared the results of the study with the Food and Drug Administration and plans to share it with the World Health Organization and other health regulators.

57 mins ago - World

U.K. prosecutors charge third person in poisoning of former Russian spy

Emergency services members in biohazard encapsulated suits encasing the poisoning scene in a tent in Salisbury, England, in March 2018. Ben Stansall/AFP via Getty Images

U.K. prosecutors said they had enough evidence to charge Denis Sergeev, a member of the Russian military intelligence service, in the 2018 Salisbury nerve agent attack against a former Russian spy, according to AP.

Why it matters: Sergeev is the third person to face charges for the nerve agent attack against Sergei Skripal and his daughter, Yulia, both of whom survived.

2 hours ago - Technology

Scoop: More boycotts coming for Facebook

Illustration: Sarah Grillo/Axios

Leaders of the Stop Hate For Profit social media boycott group are discussing whether to organize another campaign against Facebook in light of an explosive investigative series from the Wall Street Journal, Common Sense CEO Jim Steyer tells Axios.

The intrigue: Sources tell Axios that another group, separate from the Stop Hate For Profit organization, is expected to launch its own ad boycott campaign this week.