The OPEC+ meeting to try to end the oil price war is unlikely to go ahead on Monday as previously expected, as Riyadh and Moscow trade barbs about who’s to blame for the collapse in oil prices. The OPEC+ alliance needs more time for negotiations, a delegate familiar with the matter said, noting the meeting may still happen a few days later. Saudi Arabia made a pointed diplomatic attack on Russian President Vladimir Putin, opening a fresh rift between the world’s two largest oil exporters and jeopardizing a deal to cut production.
In a statement early on Saturday, the Saudi Foreign Minister Prince Faisal bin Farhan said comments by Putin laying blame on Riyadh for the end of the OPEC+ pact between the two countries in March were “fully devoid of truth.”
The direct criticism of Putin, echoed in a statement by Energy Minister Prince Abdulaziz bin Salman, threatens a new agreement to stabilize an oil market that’s been thrown into chaos by the global fight against coronavirus. President Donald Trump had devoted hours of telephone diplomacy last week to brokering a truce in the month-long price war between Moscow and Riyadh.
OPEC+ initially aimed to meet via videoconference on Monday, but they virtual gathering is now likely to be delayed a few days to allow for more time for negotiations, a delegate familiar with the matter said.
The prospect of a new deal spurred a 50% recovery in benchmark oil prices last week as traders saw some relief from the catastrophic oversupply caused by a lockdown of the world’s largest economies, in a bit to halt the coronavirus pandemic. With billions of people forced to stay at home, demand for gasoline, diesel and jet has collapsed by about as much 35 million barrels a day.
“Russia was the one that refused the agreement” in early March, the Saudi foreign ministry said. “The kingdom and 22 other countries were trying to to persuade Russia to make further cuts and extend the agreement.”
Sponsored by Trump, who’s fretting about the future of America’s shale industry, momentum for a new agreement had built in recent days.