OPEC+ found itself stuck yet again, after a day of talks ended with its two most important members split over whether they should deepen production cuts to offset the huge demand hit from the coronavirus epidemic. With oil prices down more than 20% since the beginning of the year, the debate between Russia and Saudi Arabia was being closely watched across the energy industry. The fortunes of resource-dependent economies from Africa to Asia, as well as corporate giants like Exxon Mobil Corp. and shale drillers in Texas, could turn on the cartel’s decision. Riyadh and Moscow were far apart after Wednesday’s meeting of the OPEC+ Joint Ministerial Monitoring Committee in Vienna, delegates said. The kingdom’s Energy Minister Prince Abdulaziz bin Salman was pushing for a supply reduction as big as 1.5 million barrels a day. His Russian counterpart Alexander Novak favored maintaining output at current levels through to the end of the second-quarter.
The committee did make a “wonderful recommendation” on oil policy, Prince Abdulaziz told reporters. However, he declined to reveal the details, saying he preferred to maintain “suspense.” The JMMC, which oversees the accord between the Organization of Petroleum Exporting Countries and it allies, didn’t choose between the Russian and Saudi proposals, said a delegate, who asked not to be named because the talks were private. Instead, it has been left to OPEC’s full ministerial meeting on Thursday to consider both approaches.
Brent crude rose 1.5% as of 1:29 p.m. in Singapore on Thursday, but is still down 21% this year.