An April 2 phone call between U.S. President Donald Trump and Saudi Crown Prince Mohammed bin Salman prompted Riyadh to call for an emergency meeting of OPEC and non-OPEC oil producers (also known as OPEC+) on April 6. The meeting, however, is still unlikely to yield an agreement that would push Brent crude prices back above $30 per barrel sustainably.
Given the massive demand drop due to the COVID-19 pandemic, it is clear that global oil production will eventually have to decline. Otherwise, global storage capacity will be exhausted in less than two months. The question is whether a very broad number of producer-country governments can agree on coordinated production restraint, or whether that happens as a result of individual companies’ response to price signals. Though in the near term, the latter remains more probable....
