Saudi Arabia, Russia strike deal to limit oil supply to adjust for sharp drop in demand

Saudi Arabia and Russia late Sunday reached a deal – brokered in part by President Trump – in which the world’s largest oil producers will cut their supply to the global market, as demand falls amid the coronavirus.

The deal among the Organization of the Petroleum Exporting Countries (OPEC), Russia and Mexico calls for those oil-producing nations to collectively cut their supply by 9.7 million barrels a day.

The deal first stalled in recent weeks when Russia would not agree to terms with Saudi Arabia. In recent days, Mexico President Andrés Manuel López Obrador said he couldn’t meet the request, considering how dependent his country is on oil production. 

Trump said late Friday that he helped with that sticking point by having the U.S. temporarily limit its supply to help Mexico.

The demand for oil, and prices for the commodity, have plummeted as much of the global economy has shuttered and demand has sharply declined.