Oil-producing countries have agreed to decrease oil production in May and June, the Organisation of the Petroleum Exporting Companies (OPEC) announced on Friday.
After meeting on Thursday to find a solution to the decline in crude oil prices due to collapsing demand and the price war between Saudi Arabia and Russia, all countries involved except for Mexico agreed to drop production by 10 million barrels per day from 1 May to 30 June, OPEC said.
A subsequent six-month period will see that reduction change to 8 million barrels per day, and 6 million barrels per day from 1 January 2021 to 30 April 2022.
“The agreement is conditional on the consent of Mexico,” OPEC wrote. After the meeting, Mexico’s Energy Secretary Rocío Nahle tweeted that her country “has proposed a reduction of 100,000 barrels per day over the next two months.”
The countries will meet again on 10 June “to determine further actions, as needed to balance the market,” OPEC said.
Oil prices hit a 10-year low at the end of March, with a barrel of Brent costing only $19,19 on 31 March and a barrel of WTI dropping as far down as $14.10 on 30 March, though they increased again at the beginning of April after U.S. President Donald Trump said he had discussed the drop in oil prices at length with both Russia and Saudi Arabia.
Friday’s announcement of a possible deal has not yet had a positive effect on prices, according to the Wall Street Journal.