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The demand destruction brought on by the coronavirus outbreak across the globe is simply too large and is unlikely to be fully compensated by any OPEC+ output cut deal. Hence, analysts at Goldman Sachs are of the opinion that oil price rallies on potential output cut agreement, if any, would be transient. 

Key quotes

Larger headline cut of close to 15 million barrels per day (bpd) would be much harder to achieve.

A headline cut of 10 million pbd would not be sufficient and would require at least 4 million bpd of price-induced cuts to rebalance the market.

Oil price rally, if any, would be short-lived and will likely end up paving the way for a deeper drop, boosting downside risks to our near-term West Texas Intermediate (WTI) target of $20 per barrel. 

OPEC+, a loose organization of 24 oil-producing nations led by Saudi Arabia and Russia, is widely expected to agree to some kind of output cuts on Thursday a bid to put a floor under prices.