Oil prices may plunge as OPEC delays key summit

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Hopes sparked by rising oil prices dimmed on Sunday as a virtual meeting between the Organisation of Petroleum Exporting Countries and its allies was postponed.

This is just as fresh tension mounted between Russia and Saudi Arabia over the weekend over production cuts.

Oil prices had jumped 25% on Thursday and 12% on Saturday on reports that OPEC (and its allies) were mulling a production cut equal to 10% of global supply while Russian President Vladimir Putin said a cut of 10M barrels a day seemed “possible.”

In March, OPEC proposed a cut of 1.5M barrels a day but Russia declined to go along.

The meeting ended with no agreement so Saudi Arabic dropped its oil prices in retaliation and in an effort to grab market share, subsequently ramping up production to more than 12M barrels per day.

Tensions between the two have escalated ever since.

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