“This is a significant agreement that will foster increased stability in energy markets to the benefit of both American energy consumers and producers,” Sommers said. producers to reduce supply to align with lower energy demand as result of the pandemic. Mike Sommers, the American Petroleum Institute’s CEO, welcomed OPEC’s agreement, noting they are following the lead of the global marketplace and U.S. The agreement assumes there also will be involuntary declines in production from the United States, Canada, Brazil and several other countries as private operators in those nations reduce drilling activity due to low prices and weak demand concerns.

On April 13, the Organization of Petroleum Exporting Countries and its allies agreed to cut their production by 10% in May and June, removing nearly 10 million barrels a day from the market. While its stock value bottomed out before the coronavirus pandemic went global, the resulting cut in global demand for crude oil certainly hasn’t helped. “At the same time, it is designed to make sure we don’t have an unreasonably high number of authorized shares that are unissued or reserved for issuance following the reverse split,” Webb said.Ĭhesapeake is among many oil and natural gas exploration and production companies that have seen values of their shares plummet since mid-2019. Jim Webb, Chesapeake Energy’s general counsel, told shareholders the company needs unreserved shares to give it flexibility.

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