Oil Prices Improve after Saudi Denial to Break from OPEC+

Oil Prices Improve after Saudi Denial to Break from OPEC+

Saudi Energy Minister Prince Abdulaziz bin Salman described as “nonsense” a media report that Riyadh considers a break from OPEC+.

“This is absurd and utter nonsense,” Prince Abdulaziz told Reuters on Friday.

“We have all signed up to the OPEC+ charter and will continue to act in a collective manner. We are in continuous communication and dialogue with all our OPEC and OPEC+ partners,” he added.

His comments followed the Wall Street Journal reporting that Saudi Arabia was considering a breakaway from the OPEC+ alliance as China’s coronavirus outbreak contributes to a drop in global oil demand.

The Journal said, quoting unnamed sources, Saudi Arabia, Kuwait and the United Arab Emirates plan to hold talks this week to discuss a possible joint output cut of as much as 300,000 barrels a day (bpd) by the three oil producers alone

An OPEC+ committee recommended earlier this month the group deepen its production curbs by an additional 600,000 bpd. This is to counter the oil demand loss brought about by the new coronavirus outbreak.

But Russia is yet to give final approval to the proposed cuts.

Following the Saudi minister’s comments, oil prices improved 1 percent.

Prices had fallen by more than 2.5 percent after the Wall Street Journal report.