The Organization of the Petroleum Exporting Countries, or OPEC, said on Friday that major oil producers, except Mexico, have agreed to cut output in May and June by 10 million (1 crore) barrels per day, to contain the sharp fall in prices, AFP reported.

The agreement, which reduces oil production to 8 million (80 lakh) barrels per day from July to December, needs Mexico’s consent for it to be implemented, OPEC said. The agreement was finalised after a marathon video conference of OPEC and OPEC+ countries, including Russia, as well as other key non-members on Thursday and early Friday.

Global crude oil prices have hit record lows over the past few weeks due to the coronavirus pandemic, which has led to a steep fall in demand, as well as a price war between Saudi Arabia and Russia.

The agreement cannot yet be implemented because Mexico balked at the prospect of cutting production by 4,00,000 barrels per day, Bloomberg reported. Mexico Energy Secretary Rocio Nahle Garcia said the country was ready to cut output only by 1,00,000 barrels a day.

As a result of this, crude oil prices fell in early morning trade on Friday, with Brent crude trading 4.79% down at $32.03 per barrel at 12.37 pm Indian Standard Time, and WTI crude falling a whooping 11.29% to trade at $23.19.

The energy ministers of Group of 20 countries will meet later on Friday. Countries such as the United States and Canada could, following this meeting, reduce production by as much as 5 million (50 lakh) barrels a day, according to Bloomberg.

Saudi Arabia and Russia had on April 6 postponed to Thursday the OPEC+ meeting. United States President Donald Trump had said over the last weekend that he will put pressure on Saudi Arabia and its allies for a deal with Russia. Trump said on April 4 that he will impose tariffs on Saudi and Russian oil production.

Russia is the world’s second-largest producer of crude oil, while Saudi Arabia is the world’s largest exporter.