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News Article

Unprecedented Meeting Seeks Global Oil Recovery

By Jimena de la Torre | Thu, 04/09/2020 - 09:16

Global economic instability due to the COVID-19 crisis and the oil price war between Russia and Saudi Arabia are pushing G20 energy ministers to broaden dialogue through an urgent meeting, which may take place next Friday.

The Financial Times reports that the cooperative efforts to hold this extraordinary meeting are being driven by Saudi Arabia, which currently holds the presidency of the G20, together with the leadership of Faith Birol, Director of the International Energy Agency (IEA). The gathering will take place during an unprecedented time for the world’s oil industry and just one day after OPEC+’s virtual meeting, which was put back after pressure from US President Donald Trump, reports the New York Times.

Birol told to the Financial Times that the main aim of the meeting is “to find a way to protect the market during the crisis.” In a demonstration of the concern the situation has provoked, the G20 meeting will be the first time that a meeting has been held to deal specifically with energy issues.

Worries of G20 ministers have been spurned by oil’s runaway production amid a period of sharp decline in demand. As several regions have been affected by COVID-19, many countries have suspended flights and instituted lockdowns as an urgent way to stop the movement of populations and reduce the spread of the virus. All forms of transport have been limited, with The Guardian reporting that UK road traffic levels have fallen to levels last seen in 1955, while US road traffic dropped by 38 percent during the last two weeks of March. As a result, global oil demand has fallen by more than 25 percent, according to the Financial Times, which has led to a crash in oil prices. As reported by CNN Business, on March 30, the Brent crude hit an 18-year low of $20.        

Agreements reached at the G20 meeting next Friday will have a direct impact on international geopolitics and the future of the world’s oil and gas industry. The international community and oil producing countries must be attentive to the scope that the leadership of Saudi Arabia and Faith Birol intend on having and must be willing to work together for the health of global markets.

The data used in this article was sourced from:  
Financial Times, CNN Business, Oil and Gas Magazine, Business Insider, Guardian
Photo by:   Pixabay
Jimena de la Torre Jimena de la Torre MBN staff