By Pepi Sappal •
Published: 12 Apr 2020 • 23:46
TODAY, OPEC and its oil-producing allies have finalised an unprecedented deal involving a reduction of around a 10th of global oil supply (nearly 10 million barrels) in a bid to boost falling prices and end a price war amid the Covid-19 crisis.
The deal sees Saudi Arabia and Russia ending an oil price war by agreeing to make the largest oil production cuts in history, following pressure from US President Donald Trump to support a sector heavily affected by the coronavirus pandemic.
As part of the agreement, the 23 countries have committed to cutting oil supplies by 9.7 million barrels of oil a day. They also finally agreed to allow Mexico to cut just 100,000 barrels a month, which was initially a sticking point in the negotiations.
President Trump welcomed the announcement on Twitter today, saying: “The big Oil Deal with Opec Plus is done. This will save hundreds of thousands of energy jobs in the United States. I would like to thank and congratulate President Putin of Russia and King Salman of Saudi Arabia. I just spoke to them from the Oval Office. Great deal for all!”
The cuts will start on May 1 for two months and will reduce in size before expiring in April 2022.
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