Economy

Oil prices down after OPEC production cut deal

OPEC+ cut will not be enough to avoid reaching full storage capacity unless countries outside OPEC+ also lower output

Övünç Kutlu   | 10.04.2020
Oil prices down after OPEC production cut deal

ANKARA

Crude oil prices were down during Good Friday's thin trading following OPEC's output curb decision on Thursday.

International benchmark Brent crude was at $31.82 per barrel at 0640 GMT on Friday, down 3.1% for the day after closing Thursday at $32.84 a barrel.

American benchmark West Texas Intermediate (WTI) was at $23.21 a barrel at the same time for a 7.5% decline after ending the previous day at $25.09 per barrel.

Oil prices rallied Thursday after OPEC and non-OPEC oil producing countries convened via webinar with investors to agree substantial output cuts.

The group dubbed as OPEC+ agreed early Friday to curb their total oil output by 10 million barrels per day (bpd) from May 1 until June 30 -- much less than the market expectation of 15-20 million bpd.

While the glut of supply in the oil market is estimated to increase by around 15 million bpd in the second quarter of the year, the current OPEC+ cut is not sufficient to avoid reaching full storage capacity unless countries outside OPEC+ such as the U.S., Canada, Brazil, and Norway also lower their individual outputs.


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