Despite rising pressure from the US to stop a price rout amid the coronavirus pandemic, Saudi Arabia said it was not in talks with Russia to balance oil markets.
After Russia refused to support Saudi’s plan for deeper production cuts, a three-year supply pact between the OPEC and other producers, including Russia, fell apart this month. This prompted the kingdom to pledge to increase output to a record high.
As governments around the world implement national lockdowns to slow the spread of the coronavirus, the resulting supply boost has coincided with plummeting demand. The twin-pronged assault on prices has hammered the income of oil producers and sent Brent crude LCOc1 to a 17-year low below $25 a barrel.
After Russia refused to support bigger output curbs, the deal broke down between the country and OPEC. It was too early to estimate the impact of the pandemic, Russia argued.
In Russia, oil executives have been split into different views on the need for cuts. Cooperation supported by Dmitriev and Novak. Meanwhile, the cuts have been criticised by Igor Sechin, the head of Kremlin oil major Rosneft as providing a lifeline to the less competitive US shale industry. Since the OPEC+ deal collapsed, President Vladimir Putin has said little.
