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Pressure mounted on Mexico on Saturday to agree on cuts to oil output that would set the seal on the biggest production deal in the industry’s history.
The OPEC+ alliance led by Saudi Arabia and Russia was said to have made some progress on Saturday as negotiations with Mexico continued, with US President Donald Trump acting as a broker.
Mexico’s reticence is the only stumbling block to an unprecedented agreement to reduce oil output by at least 10 million barrels a day. Because of the COVID-19 pandemic, global demand has fallen by at least 25 million barrels a day.
Industry experts believe agreement is inevitable. “The whole Mexico discussion is a distraction that will be forgotten by Tuesday,” said Roger Diwan of the IHS Markit consultancy.
The deal calls for Mexico to cut output by 400,000 barrels — 23 per cent, the same as other producers. Mexico’s national economic plan commits it to maximizing oil revenue, and it argues that it should cut less than the others.
Saudi Aramco has delayed publication of the price at which it will offer crude to customers on global markets in May. The company wants to finalize the OPEC+ deal before it makes that decision.
Energy ministers from the G20 under the Saudi presidency endorsed the OPEC+ deal early on Saturday, and called for continued supervision of energy markets to ensure stability.
Norway, the biggest European producer, said it was considering its own cuts if the OPEC+ deal went through.
