The United States and Mexico have decided to cut down the oil production under an agreement among Oil and Petroleum Exporting Countries (OPEC), President Donald Trump said on Friday.
The OPEC nations have agreed to "a different limit reduction of about 23 per cent", Trump told reporters at his daily White House news conference on coronavirus.
He said he spoke with leaders of Saudi Arabia and Russia and played a key role in OPEC reaching the deal to cut down their oil production.
Due to the global health crisis, the OPEC members and other oil producing countries want to reduce the oil production.
But Russia and Saudi Arabia have entered into a price war with both the countries ramping up their production, leading to the oil prices plunging to a historic low.
During a virtual meeting of the OPEC and non-OPEC nations on Thursday, the major producers said the oil output would be cut by 10 million barrels per day in May and June.
The OPEC, in a statement, said the cuts would down to eight million barrels a day for the rest of the year and beginning January 2021, it would be further lowered to 6 million barrels a day till at least April 2022.
Mexico, however, refused to agree to its share of cuts which could have been 400,000 barrels per day.
We are trying to get Mexico as expression goes over the barrel and Mexico is committing to do 100,000 fewer barrels.
"The (Mexican) President ([Lpez Obrador), and I spoke last night. We have a great relationship and great friendship they're helping us very much at the border. They have 27,000 Mexican soldiers on our border right now stopping people from coming into our country as our wall goes up. We've up to about 168 miles of wall, Trump said.
And in speaking with the President they have a limit; the OPEC nations have agreed to a different limit reduction of about 23 percent. So what I thought I would do -- and I don't know that it's going to be accepted -- we will find out the United States will help Mexico along and they will reimburse us some time at a later date when they are prepared to do so, and we had a great conversation, but we will find out how that all works out, he said.
They are trying to get rid of the glut of oil -- there is a tremendous glut of oil -- and we don't want anything to hurt our incredible industry. We actually are the largest producer in the world now, so we don't want anything to hurt those jobs, those great jobs in Texas and North Dakota and Oklahoma and everywhere, he added.
We have a tremendous energy... tremendous energy business with New Mexico, and we want to keep those jobs, so we are working on it. I think eventually it's going to work out, may work out quicker than what most people thought possible, and maybe it won't, but it will work out eventually, Trump said.
Disclaimer: No Business Standard Journalist was involved in creation of this content
