Russia Has Blocked in OPEC the Oil Production Cut Due to Coronavirus

Moscow rejected the recommendation of the OPEC technical committee to reduce oil production by 600 thousand barrels per day due to falling demand. Russia has blocked the Organization of Petroleum Exporting Countries (OPEC) decision to reduce oil production. On Thursday, February 6, Russian and international media reported that representatives of the Russian Federation did not support the recommendation of the OPEC technical committee on the need to reduce production by an additional 600 thousand barrels per day due to falling demand caused by the coronavirus. Russia assesses the oil production reduction proposal In particular, TASS, citing a source of a delegation, writes that the Russian side requested the resumption of consultations and the format of further negotiations is still unknown. Interfax, citing a source familiar with the situation, indicates that Russia took time to evaluate the recommendations of the OPEC technical committee. According to Bloomberg, the OPEC technical committee recommended that the organization’s member countries reduce oil production by 600 thousand barrels per day until June of this year due to consequences of coronavirus spreading in China. Initially, the OPEC committee meeting was planned to be held in early March, shortly before the ministers of the participating countries meeting. An extraordinary meeting was convened in connection with the coronavirus epidemic. Saudi Arabia proposal According to The Wall Street Journal, Saudi Arabia proposed a reduction in oil production at a meeting of the OPEC Technical Committee in Vienna. The meeting was scheduled only on February 4 and 5, but Russia requested an extension of the negotiations, it is noted further. Initially, Riyadh, the largest oil exporter in the world, demanded a reduction in production by 800 thousand barrels per day, The Wall Street Journal reports. Oil prices have dropped significantly due to concerns about a possible reduction in the growth of the Chinese economy since the beginning of the spread of the new coronavirus in China. China is the world's largest oil importer.