China, one of the world’s highest consumers of oil, and the Organisation of the Petroleum Exporting Countries (OPEC) have agreed to work together to stabilise the oil market.
OPEC said this on Wednesday during a bilateral meeting.
The oil market is suffering from falling demand and low prices in light of the coronavirus pandemic.
The “milestone” talks between the Chinese delegation and OPEC Secretary General Mohammad Barkindo were held on Thursday in an online format, according to the cartel.
“The meeting reflected on the impact of the COVID-19 pandemic on the global economy and oil market, as well as China’s domestic oil market, the rebalancing process of oil supply and demand, and China’s solutions for and optimisation of the oil and gas trade system.
“The meeting also reached a consensus on the importance of energy security and maintaining stability in the energy markets, strengthening collaboration between OPEC and China,” OPEC said in a statement.
Oil prices fell dramatically earlier this year against the background of the global coronavirus outbreak, which resulted in the implementation of lockdown measures and the suspension of production.
As China and a number of other countries are now resuming domestic production, the oil market is expected to stabilise by the end of 2020.
The OPEC+ countries, as well as oil producers from a wider G20 group of nations, such as the U.S., Brazil and Canada, reached the oil production cut deal in mid-April.
The deal envisages a reduction in oil production by the OPEC+ group by 9.7 million barrels per day for two months starting on May 1, and possibly up to 15 million barrels daily with the G20 nations taken into account.