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Opinion
Liam Denning

OPEC+ and the G-20 Say ‘Yes' To Duress

To cut or not to cut isn't even a question for oil producers facing a Covid-19 demand shock.

If people aren’t buying fuel, then producers are selling into a void — and therefore must cut.

If people aren’t buying fuel, then producers are selling into a void — and therefore must cut.

Photographer: Daniel Acker/Bloomberg

The last time OPEC+ met, its members said they would be opening the taps to reassert their control of the oil market. Barely a month later, they are set to … tighten the taps … to reassert … you see the problem.

Covid-19 has made a mockery of just about any plan made a month ago. Global oil demand has dropped by perhaps a third. If people aren’t buying fuel, then refiners aren’t buying crude oil, which means producers are selling into a void — and therefore must cut. Thursday’s fractious OPEC+ meeting — with Mexico taking a starring, stubborn role — was all about apportioning unappetizing slices of a cake called inevitability.