STEVE INSKEEP, HOST:
The pandemic sharply cut demand for fuel. If you've been working from home or educating your kids at home, think of all the miles you didn't drive. The oil industry has been struggling all year. Now the cartel of oil-producing countries known as OPEC is fighting over what to do next. So much to discuss here, so we brought in Camila Domonoske, who covers energy for NPR News. Good morning.
CAMILA DOMONOSKE, BYLINE: Good morning. How are you?
INSKEEP: I'm remembering the time in the spring when oil got so cheap that oil - people with oil were actually having to pay other people to get it off their hands. It was a negative oil price. What's happening with oil prices now?
DOMONOSKE: Well, they've been stabilized much of the year because of aggressive action from OPEC. And then more recently, they got a big boost from all the news about vaccine breakthroughs. Vaccines aren't actually here yet, so demand hasn't recovered. But, you know, expectations about the future play a huge role in the price of oil. And so all of the hope has sent prices up to their highest levels since March, actually.
INSKEEP: And now the OPEC nations, which, of course, to state the obvious, don't include the United States, but Saudi Arabia, a bunch of other big oil producers, are meeting. Why is this important?
DOMONOSKE: Well, they are trying to strike a deal to extend these production cuts that did stabilize prices for so much of the year. These talks were supposed to take a couple of days, but it looks like it's going to be most of the week. The problem is that, you know, there is consensus that these cuts ought to be continued because, again, vaccines aren't here yet. Demand isn't back. But they have to get every single member to agree and not just the members of OPEC itself but their allies, which include Russia.
INSKEEP: Who is it that doesn't want to continue these production restraints?
DOMONOSKE: Well, it's not actually about whether or not to continue the cuts. OPEC talks are always complicated because they have to agree on who cuts by how much. And in this case, we also have countries like the United Arab Emirates where it seems like there are questions about what the consequences should be for other members who cheated and sold more oil than they were supposed to. I mean, this is a classic problem for OPEC. Everyone wants to make sure that everyone else is taking on a fair share of the pain of these cuts. So if they don't strike a deal in the next few days, that is expected to send the price of oil dropping.
INSKEEP: So you said future expectations are really important. What are the long-term expectations of the industry knowing as they do that many countries are fighting climate change, trying to reduce their use of fossil fuels and in the United States, President Trump, who was effectively a climate denier, is on his way out and President-elect Joe Biden is on his way in and wants to rejoin the Paris climate accord?
DOMONOSKE: Right. There are really varying predictions within the oil industry about when exactly oil will peak and demand is going to start to go down. There's widespread consensus that that is going to happen. The question is how long it takes. And you have some oil companies - you have the Shells and BPs of the world who say this could be happening very soon and it's time for oil companies to invest in renewables. OPEC pegs this as happening farther out. They see demand for petroleum staying robust for a long time to come. So it really is split. And, you know, it's interesting because, right now, we're looking both at these long-term effects of climate change and climate action, but there's also the pandemic itself. If you consider that all of these members of OPEC normally fly to Vienna to talk and right now they're talking via video chat and telephone call - right? - after we have a vaccine, will some of those changes stick around? And does that impact how our oil use changes?
INSKEEP: Sure. Do they need to fly to Vienna in the future? Camila, thanks so much.
DOMONOSKE: Yeah, thank you.
INSKEEP: NPR's Camila Domonoske.
(SOUNDBITE OF NOLOLOM'S "FINAL CALL")
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