The global oil industry has been scrambling for a solution to the dramatic oil price crash and enduring global crude glut from last month. As the novel coronavirus swept the globe over the past few months, shutting down countless industrial endeavors, the devastating economic impact tanked international oil demand and overall energy use. When the OPEC+ leading members of Russia and Saudi Arabia began talks to determine how to respond to the faltering oil demand, the alliance quickly disintegrated, leading to an all-out oil price war and a global crude glut to the tune of about 10 million barrels of oversupply per day.
On Sunday OPEC+ decided to try to reduce the glut and thereby bolster oil prices with historic production cuts. On Monday the coalition led by Russia and Saudi Arabia announced that they will slash production by a whopping 9.7 million barrels in May and June. The United States, for its part, has been typically polarized as to how to respond to the crisis in global oil markets.
Energy demand will not bounce back in the immediate future, either, as the global economic shutdown persists, and some countries are only now beginning widespread shelter-in-place measures.
Last updated on Sun., April 19, 2020.