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June 2, 2020

Coronavirus company news summary – OPEC and Russia mull extending production cuts – US postpones more oil and gas lease sales

By Jessica Paige

2 June

OPEC and Russia are currently in discussions to extend the ongoing oil production cuts after the recent fall in demand triggered the oil price to crash. According to Reuters, unnamed sources said that Saudi Arabia, the de-facto OPEC leader, aims to extend the cuts until year-end.

India’s petrol and diesel sales increased last month after falling to record lows, as the government relaxed some Covid-19 related restrictions. In May, gasoline sales jumped by nearly 83% from April to nearly 1.6 million tonnes. However, industry analysts told Reuters that it may take months for the sales to reach pre-Covid-19 consumption levels.

Canadian energy company Athabasca Oil has said that its banking syndicate has slashed its credit facility to C$42m ($30.72m) amid the current Covid-19 crisis. The creditors revised the reserve-based facility to 30 November. Athabasca Oil also noted that it continues to pursue opportunities to access credit assistance offered by the Canadian Government.

The US administration has postponed at least two oil and gas lease sales scheduled later this month, after it deferred a major sale in New Mexico last month. The recent move includes postponing the sale of seven oil and gas leases in Nevada. It comes at a time when oil prices have weakened due to Covid-19 pandemic.

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