Saudi Arabia is bearing a greater burden for production cuts, while Russia is nowhere near the reductions it promised. That arrangement can’t last.
I know a little bit about standing on one leg; my daughter has encouraged me to learn to water ski. It’s not easy at my age, in England, in winter. OK, I’m actually on two legs, but they are on one ski. I tend to wobble a lot and to fall over much more than I would like. It sort of reminds me of the current state of the OPEC+ oil deal that was updated in December. That is also standing on a single leg and starting to look a bit shaky.
The deal had two main pillars (let’s call them legs) to hold the whole thing up. They were Saudi Arabia and Russia, the leaders, at least in volume terms, of the groups of countries that were party to the production deal. They agreed to take the biggest share of each group’s pledged output cuts — Saudi Arabia shouldering 40 percent of the OPEC burden and Russia assuming 60 percent of the non-OPEC contribution.
