But Russia refused to back the plan at a meeting with OPEC in Vienna on Friday, leaving the future of its three-year alliance with the cartel in doubt and raising the prospect of a huge supply glut.
OPEC Secretary General Mohammed Barkindo, speaking to reporters after the meeting broke up, said there was no consensus to extend the policy of supply restraint beyond the end of March and OPEC would not act unilaterally. Discussions would continue, he added, but gave no further detail.
Russian energy minister Alexander Novak told CNN Business that producers would make their own decisions on what to do from April 1.
Brent crude, the global benchmark, settled 9.4% lower at $45.27 a barrel. That was its worst level in nearly three years. It was the worst one-day percentage drop since December 2008.
US oil prices settled 10.1% lower at $41.28 on Friday — the biggest one day percentage drop since November 2014. It was the lowest close since August 2016.
Most of the reduction in demand can be traced to China, where the coronavirus has caused what IHS Markit describes as an “unprecedented stoppage” of economic activity.
Goldman Sachs told clients this week that OPEC needed to agree to curb production by at least 1 million barrels per day in order to avoid a “sharp” sell-off.
The investment bank now believes that oil demand will shrink in 2020. Before the coronavirus outbreak, it expected demand to increase by 1.1 million barrels per day.
— Julia Horowitz, Cristiana Moisescu and Anneken Tappe contributed reporting.