OPEC+ World Leaders Meet Today to Discuss Solutions to the Recent Oil Market Slump

OPEC+ World Leaders Meet Today to Discuss Solutions to the Recent Oil Market Slump

April 9, 2020

Today, OPEC+ world leaders are set to hold a virtual conference to try to find solutions to the recent plunge in energy prices that has caused the major disruption to the oil market.

According to Forbes:

The world is using about 25% less oil than it typically does, a jarring collapse in an industry known for only gradual fluctuations in demand.

But fighting among some of the largest producers has aggravated the volatility.

Instead of curtailing production to meet the reduced appetite for oil, the Saudis and allied producers ramped up output in a tiff with Moscow, as an agreement between Russia and OPEC on trimming output expired.

This helped drive low prices even lower. West Texas Intermediate, the U.S. bench mark, scraped the $20-a-barrel level in late March. Some crude in the United States fell well below $10 a barrel. Prices at this level could prove catastrophic for the U.S. shale industry — a likely goal of Saudi and Russian oil producers.

Trump has urged Russia and Saudi Arabia to slash production by at least 10 million barrels per day ahead of today’s meeting.

American producers and the Trump administration share a goal: Balance the market to stabilize oil prices and save the industry from a rash of bankruptcies and the potential loss of more than 100,000 jobs.

An agreement has yet to be announced, but oil-exporting countries are desperate to find common ground to counter the recent market turbulence. Reducing the production to counter the historic drop in prices, due to the falling demand from the coronavirus pandemic is a viable solution. Power The Future supports President Trump’s leadership and stance on facing this issue.