Global oil producers have struck a historic deal to slash production by 10 per cent in a desperate bid to support tumbling oil prices. The production cuts are the largest ever to have been agreed and bring and end to the month-long price war between Russia and Saudi Arabia. Producers hope the 10 per cent cut, which is four times larger than the cut after the GFC and will eventually rise to 20 per cent of pre-crisis levels, will shore up global oil prices after collapsing demand pushed them to 18-year lows. But although the price of Brent Crude rose 4.1 per cent to $US32.80 a barrel ($51.75) during trading in Asia on Monday, it is 50 per cent lower than it was at the start of the year. And banks Goldman Sachs and UBS predict the economic disruption caused by the coronavirus could force it down towards $US20 a barrel ($31.56) – meaning the deal is unlikely to push up prices at Australian bowsers.
