Global pact to contain oil price crash takes shape

DUBAI, United Arab Emirates (AP) — The OPEC oil cartel and nations including Russia have agreed to boost oil prices by cutting as much as 10 million barrels a day in production, or a tenth of global supply.

More countries, including the United States, were discussing Friday their own cuts in what would be an unprecedented global pact to stabilise the market.

The agreement between OPEC and partner countries aims to cut 10 million barrels per day until July, then 8 million barrels per day through the end of the year, and 6 million a day for 16 months beginning in 2021.

Mexico had initially blocked the deal but its president, Andrés Manuel López Obrador, said Friday that he had agreed with US President Donald Trump that the US will compensate what Mexico cannot add to the proposed cuts.

“The United States will help Mexico along and they’ll reimburse us sometime at later date when they’re prepared to do so,” Trump said at a White House press briefing Friday.

Mexico had offered to cut production by 100,000 barrels per day, but OPEC wanted more of a sacrifice.

So the US agreed to fill in the gap and cut its production by 250,000 to 300,000 barrels per day, “which we’ve already done, by the way,” Trump said.

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