Oil prices on short advance after the production cuts news
The oil price briefly rebounded after it became known that the major oil-producing countries have signed a production restriction deal. A barrel of US oil was up 9 percent to nearly $ 25, and Brent oil rose 6 percent to $ 31.54 a barrel. Prices fell again soon after.
On Sunday, OPEC +, made up of OPEC oil cartel and allies such as Russia, agreed to cut production by some 10 million barrels a day to boost oil prices. That’s about 10 percent of global production. According to the oil minister of Kuwait, that could even become 20 million barrels a day, if other countries also cut production further.
Although an agreed reduction of 10 million barrels per day is a record, experts believe that the agreement is insufficient to counter the oversupply. Especially because the demand for fuel has fallen sharply due to the corona pandemic.