Washington — US President Donald Trump made the case Monday for doubling the oil supply cuts just approved by OPEC+ to 20 million b/d, saying the move would restore the energy sector faster.
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The tweet did not appear to move oil markets, which were waiting for greater clarity on the deal reached Sunday after Saudi Arabia, under pressure from the US, ended a four-day stalemate with Mexico that threatened to escalate a price war in the middle of the coronavirus crisis.
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"Having been involved in the negotiations, to put it mildly, the number that OPEC+ is looking to cut is 20 Million Barrels a day, not the 10 Million that is generally being reported," Trump tweeted. "If anything near this happens, and the World gets back to business from the Covid 19 ... disaster, the Energy Industry will be strong again, far faster than currently anticipated.
"Thank you to all of those who worked with me on getting this very big business back on track, in particular Russia and Saudi Arabia."
Under the deal announced Sunday, the 23-country OPEC+ alliance rein in 9.7 million b/d of crude oil production for May and June -- down from 10 million b/d originally envisaged, as Mexico was allowed a more generous quota.
Combined with financially forced shut-ins of wells in the US and Canada, some further output restraints by Brazil, Norway and others, and purchases of crude by various countries to fill strategic petroleum reserves, the market could see up to 20 million b/d -- one-fifth of world supply — removed over the next two months, officials said, though the exact math was unclear.
However, it may not be enough to stabilize the market in the short term, with many analysts projecting an oversupply of at least 20 million b/d in the coming months as oil storage options dwindle.