Reuters must have had access to an internal document which shows that some members of the oil cartel Opec + must cut production by more than two million barrels per day.
It writes the news agency Thursday.
The cut must be made to make up for an overproduction in the period May to July. The reduction must be made during August and September.
Opec + includes members of the Opec cartel as well as other oil producers, such as Russia.
The group increased its joint production cuts to 9.7 million barrels per day in May, before reducing the actual cut to 7.7 million barrels per day earlier this month.
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Need to cut more again
The price of oil fell like a rock in March as a result of the coronavirus and the subsequent shutdown. Reuters points out that the ongoing spread of the virus puts a damper on forecasts of recovery in oil demand.
The internal report Reuters has been given access to does not say how the extra cuts will be distributed over August and September, but if the cut of 2.31 million barrels per day is adopted and spread evenly over the two months, it will take the oil cut to approx. 8.85 million barrels per day, writes Reuters.
«Worst case»-scenario
According to Reuters, the report shows that Opec + expects that demand for oil in 2020 will fall by 9.1 million barrels per day, 100,000 barrels more than in the previous forecast, before it will increase by seven million barrels in 2021.
However, the cartel must also have an alternative expectation – in case the corona crisis becomes stronger and longer lasting than it is likely to be.
In a scenario where a strong second wave of the virus hits Europe, the US, India and China in the second half of the year, Opec + sees that demand could fall by 11.2 million barrels in the second half of the year.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases using a link, which leads directly to our pages. Copying or other form of use of all or part of the content, can only take place with written permission or as permitted by law. For additional terms look here.
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