The OPEC+ Joint Technical Committee is going to meet next week, but the coronavirus fears made the organizers take such measure, Bloomberg reports.
OPEC needs to assess compliance with the group’s final month of oil production cuts. Following the World Health Organization declared the coronavirus pandemic, the next meeting of the technical committee will be held by the phone.
In light of the latest developments, the Joint Technical Committee is not attended by oil ministers and doesn’t have the power to make policy decisions, so its talks next week won’t have any bearing on the collapse of the OPEC+ production-cuts agreement and subsequent price war between Saudi Arabia and Russia.
The meeting is set for March 18 and will be in the format of a teleconference. The Russian Energy Minister Alexander Novak welcomed such a reasonable decision in the given circumstances.
After its two largest oil producers, Russia and Saudi Arabia, disagreed this week over the need for deeper output cuts, a price war started. Since Monday, oil tumbled by about a quarter after the Saudi giant ARAMCO slashed official pricing for their crude and promised to flood the world with oil.
Globally, the situation with coronavirus makes the government take unpopular measures. Growing fears over the COVID-19 epidemic led President Trump to significantly restrict travel from Europe and forced Italy into an unprecedented lock-down until March 25. The pathogen has also slashed demand for oil, with OPEC cutting its oil growth forecast for this year by 920,000 barrels a day to 60,000.
The OPEC+ Joint Technical Committee include Russia, Saudi Arabia as well as Algeria, Iraq, Kazakhstan, Kuwait, Nigeria and the United Arab Emirates.