Market Overview

OPEC+ Agrees To Historic Deal To Cut Oil Production

Share:
OPEC+ Agrees To Historic Deal To Cut Oil Production

Following several days of meetings that began last Thursday, a historic oil deal has been reached.

OPEC+ have agreed to cut production by 9.7 million barrels per day for May and June. Mexico, which was a key country that that kept an agreement delayed, will cut its output by about 100,000 barrels per day. In all, this represents about 10% of global supply.

Oil prices have been volatile since Russia's disagreement with OPEC's decision to cut oil supply in early March resulted in a price war with Saudi Arabia.

"Measures to slow the spread of the coronavirus have destroyed demand for fuel and driven down oil prices, straining budgets of oil producers and hammering the U.S. shale industry, which is more vulnerable to low prices due to its higher costs," according to Reuters.

Benzinga is covering every angle of how the coronavirus affects the financial world. For daily updates, sign up for our coronavirus newsletter.

"In the biggest oil output cut ever, exceeding four times the cuts approves during the 2008 financial crisis, the countries will keep gradually decreasing curbs on production in place for two years until April 2022," Reuters reported.

The United States Oil Fund LP (NYSE: USO) fell 7.26% to $4.98 on Thursday, while the Direxion Dly S&P Oil&Gs Ex&Prd Bl 3X ETF (NYSE: GUSH) closed 0.7% higher at $24.51.

Related Links:

What To Know About The Stock Market's Best Week Since 1974

How The US Response To COVID-19 Stacks Up Versus Italy, Spain And More

 

Related Articles (USO)

View Comments and Join the Discussion!

Posted-In: Coronavirus Oil OPEC OPEC+News Commodities Markets Best of Benzinga