According to Reuters, even if OPEC+ oil producers agree to extra pumping cuts due to the current crisis, there is a rapid filling of storage capacity and a sharp drop in demand. As such, the framework can force them to further reduce supply.
As of May, due to the collapse in commodity consumption, OPEC, plus Russia and other producing nations are expected to close a deal for record supply cuts of 9.7 million barrels per day (bpd). However, the agreement may be inadequate, as demand has plummeted by up to 30% and it is possible that the world is just weeks away from experiencing a depletion of storage capacity for the supply surplus.
One example is Vopak, the largest independent oil storage company in the world, which said last Tuesday (21) that its tanks are practically full. Tanks in the United States, in Cushing, may not be fully filled so far, but all available space has already been reserved, according to analysts and operators.