During the talks in Vienna, the Saudis proposed lowering oil output by 1.5 million barrels per day during the second quarter of the current year in response to the coronavirus epidemic and a downturn in global demand, which, according to Goldman Sachs estimates, could exceed two million barrels per day. Russia, in the person of Energy Minister Alexander Novak, flatly refused to reduce production and only proposed to set current production volumes for another quarter. Riyadh turned the offer down. The next day, global markets collapsed, the ruble lost ten percent of its value against the dollar.
Russian oil companies have long wanted to exit the deal: OPEC+ was favored only by those companies that were developing no new deposits and had no opportunity to increase production on old ones.
It goes about such companies as Lukoil. Its top manager Leonid Fedun announced that the decline in oil prices after the failure of negotiations with OPEC could lead to a loss of $100-150 million per day. It could be true, but one can win the game by sacrificing a pawn. Many analysts believe that Russia should have left the deal long ago as Russian companies were losing their part of the market and could not invest in new deposits.
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