SUCCUMBING TO THE pressure of US Pres. Do­nald Trump, the Orga­niza­ti­on of Pet­ro­le­um Expor­ting Coun­tri­es (OPEC), Rus­sia and other oil-producing countries ag­reed on April 12 to cut production by 10% or 9.7 million barrels per day from Ma­y to June. This will be the highest oil production cut in history.

The reduction aims to arrest plunging oil prices in the global market due to the Covid-19 pandemic. Oil demand further dropped simultaneous with the suspension of operations of factories and enterprises across the globe. As a result, the average price of brent crude dropped to $20.09 per barrel, the lowest since 2002. Oil companies, especially those in the US incur huge profit losses, when the price of brent crude in the global market is lower than $30 per barrel.