Agreement between OPEC and Russia will help stabilize oil prices, says MME

Posted by Marina
The Minister of Mines and Energy, Bento Albuquerque, said last Friday (10), that the agreement between Russia and Saudi Arabia, to reduce oil production, will contribute to the stabilization of the prices of the product in the international market, informs “Agência Brasil”. Albuquerque participated in a video conference between energy ministers from the G20 countries.

“I hope that the world can overcome this unprecedented crisis in the shortest time and I am sure that we in the energy sector have a fundamental role in making this possible. In this sense, Brazil congratulates Saudi Arabia and the OPEC + countries for the agreement, which will contribute to the stabilization of the oil market, ”he said.

The agreement between the oil producing countries foresees to reduce world production by ten million barrels per day, about 23% of the total daily production, between May and June, and by eight million barrels per day, between July and December. On one side is Saudi Arabia, which leads the Organization of Petroleum Exporting Countries (OPEC), and its allies, a group known as OPEC +. On the other, the rest of the oil-producing countries, led by Russia.

The crisis caused by the coronavirus pandemic unbalanced a market in which the global supply was already in surplus and the fall in the global demand for fuels put downward pressure on international oil prices. In addition, Russia and Saudi Arabia were fighting over oil production and prices. In March of this year, the price of the barrel came to close below US $ 30. Last year, the commodity was traded between US $ 60 to US $ 70 a barrel.

The meeting between the G20 ministers served to discuss the effects and measures to deal with the COVID-19 pandemic on the energy sector. During his speech, Minister Bento Albuquerque said that the Brazilian government has no influence on the oil market, but highlighted the reduction in Petrobras' production.

“The company, based on its business plan, has already reduced its production by 200 thousand barrels of oil per day, which represents 20% of Brazil's total oil exports. Petrobras also reduced fuel production at its refineries, due to the retraction in international markets and the drop in domestic consumption, as a result of COVID-19 ”, said the minister.