Following President Trump’s previous tweet that he had discussed oil prices with the Crown Prince of Saudi Arabia, Texas Railroad commissioner Ryan Sitton said he had discussed with the Russian Minister of Energy , Alexander Novak, of the possibility of withdrawing 10 million barrels per day from world oil markets.
“… We have agreed that # COVID19 requires an unprecedented level of international cooperation,” read part of the tweet from Sitton.
Sitton said he looked forward to meeting with Saudi energy minister Prince Abdulaziz bin Salman as well.
The failed cooperation of Russia and Saudi Arabia in the OPEC + agreement has resulted in increased production of OPEC, with Saudi Arabia, the United Arab Emirates, Kuwait and Russia promising to increase production. Saudi Arabia previously reported that it had increased oil production to more than 12 million bpd.
The additional barrels on the market coincided with the Covid-19 pandemic, which destroyed world demand for oil, pushing oil prices to levels not seen in years.
Oil prices were trading more than 20% Thursday afternoon following the positive development of the oil market, WTI crude trading at $ 24.80 (+ $ 4.49) and Brent crude at 30, $ 02 ($ 5.28). Oil prices rose even more immediately after President Trump’s tweet, but prices have fallen somewhat since then.
Several analysts have suggested that any OPEC action would be too little, too late, as demand should not drop anytime soon due to the pandemic. A drop of 10 million barrels per day would however greatly help stabilize the oil market.
The Saudi news agency confirmed earlier on Thursday that it had convened an emergency meeting for OPEC + and other states to discuss oil markets and the response to the coronavirus. Details of the meeting schedule, however, have not been released.
By Julianne Geiger for Oilprice.com
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