VIENNA, Austria (NBC) – The oil cartel OPEC plans on cutting production because of the coronavirus.
Demand for oil is falling because business around the world is sagging.
The 14 OPEC member countries would cut production by a million barrels a day for the second quarter.
Non-member countries, like Russia, would cut a half-million barrels a day.
Opec countries approved the proposal Thursday. Russia and other non-member countries take up the plan Friday.
“I Already told the media that we are all in this together,” said United Arab Emirates Energy Minister Suhail al-Mazrouei. “So it’s not going to be that us making a decision alone, the assumption we are all OPEC and non-OPEC going to be together. I am hopeful that we will reach an agreement tomorrow. And let’s leave it till tomorrow.”
Some oil countries are known for agreeing to cuts, but quietly selling more oil on the market. But cutting production may not boost oil prices. One reason is that the U.S. has been flooding the market with cheaply-produced crude.
The international benchmark for crude was trading at $51.25 a barrel, down from around $69 at the start of the year.
The U.S. imports 29% of its oil from OPEC with Saudi Arabia as the major supplier.
Journalists were barred from the oil ministers meeting because of the coronavirus.
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