A deal to extend record OPEC+ output cuts was going smoothly -- until Saudi Arabia and Russia discovered just how much some of their allies had been cheating.
In private conversations, Saudi Arabia Energy Minister Prince Abdulaziz bin Salman and his Russian counterpart Alexander Novak had agreed with little fanfare on May 28 to extend oil production cuts by one more month. Their bosses had spoken the day before. With the two power players aligned, Prince Abdulaziz suggested bringing the meeting with other OPEC ministers forward, and Novak had no objection.
The cartel appeared on the brink of a deal.
Then, a day later, the trouble started. The first OPEC output surveys, compiled by news organization and consultants, showed that Angola, Iraq, Kazakhstan and Nigeria weren’t squeezing supply nearly as much as they had promised. Baghdad was the worst offender.
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OPEC ministers meet via video conference June 6, 2020. OPEC |
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