OPEC, Russia agree to oil output cuts; Mexico rejects global plan

London: Major oil producers except Mexico agreed to cut output in May and June by 10 million barrels per day, OPEC said Friday, after marathon talks to counter a collapse in prices.

The agreement, which reduces production to eight million bpd from July to December, depends on Mexico's consent for it to take effect, the oil cartel said after a videoconference.

The virtual meeting of OPEC countries and their OPEC+ allies including Russia, as well as other key non-members, began just after 1440 GMT on Thursday.

It was seen as the best chance of providing support to prices, which have been wallowing near two-decade lows due to the coronavirus pandemic and a Saudi-Russian price war.

Talks dragged on into the small hours of Friday. Bloomberg News reported that the main sticking point was the refusal of Mexico to sign up to its share of cuts under the deal, which would have been 400,000 barrels per day.

Mexican Energy Minister Rocio Nahle Garcia tweeted that her country had suggested a cut of 100,000 barrels.

Venezuela's state oil company PDVSA said in an earlier statement that Caracas "supports the proposal of Saudi Arabia and Russia to reduce production by around 10 million barrels per day".

US President Donald Trump had expressed optimism about the prospects for an agreement  even as the talks appeared to be at an impasse.

"I would say they are getting close to a deal. We will soon find out," Trump told a press briefing at the White House at on Thursday.

Trump was speaking fresh from a conference call with Russian President Vladimir Putin and Saudi leader Crown Prince Mohammed bin Salman -- both countries being key players in the talks.

At the beginning of the meeting, OPEC Secretary General Mohammad Barkindo warned that the rapid economic damage wrought by the virus meant the industry's "supply and demand fundamentals are horrifying".

Another virtual meeting is scheduled for June 10 "to determine further actions, as needed to balance the market", OPEC said.

Saudi Arabia will on Friday host a separate virtual gathering of energy ministers from the G20 group of major economies in a similar bid to ensure "market stability".

Oil prices have slumped since the beginning of the year as the COVID-19 pandemic sends large parts of the planet into lockdown and brings the global economy to a virtual standstill.