OPEC+ is a group of 24 oil-producing nations, made up of the 14 members of the Organization of Petroleum Exporting Countries (OPEC), and 10 other non-OPEC members, including Russia.
Saudi Arabia the largest producer of Oil in world lead the OPEC+, while Russia is the biggest player among the non-OPEC countries.
OPEC+ formed to coordinate oil production among the countries in a bid to stabilize prices.
OPEC+ members sets production targets among its members to manage oil production. OPEC member countries produce about 40% of the world’s crude oil.
Rising Crude Oil Prices
Brent crude price had fallen from $66 per barrel at the beginning of 2019 to $19 in April 2020 due to travel curbs and lockdowns. It has now reached close to $60 per barrel.
Crude oil prices react to many variables, including economic news, overall supplies, and consumer demand. OPEC is an international oil producing cartel that plays an important role in determining global oil supplies.
Covid-19 became a deadly pandemic that cause global growth to crater, eventually sending crude oil prices plunging into negative territory. In response to plummeting prices, oil producing countries cut supply and vast reserves piled up. Since last spring, OPEC and its allies, including Russia, have cut production by a total of 2.1 billion barrels.
Global crude oil prices have been rallying after the Organization of the Petroleum Exporting Countries (Opec)-plus meeting on 3 February decided to continue with supply curbs even after rising demand. Chinese demand for crude oil is also helping support the market
Since India imports 84 per cent of its domestic demands for crude oil. Therefore, Brent crude prices have a direct bearing on domestic fuel prices.
OPEC+ Meeting Next Months to Stabiles Prices
Early next month, OPEC+ oil ministers will meet to discuss production plans for April. Saudi Arabia will be adding back the 1 million barrels a day of its voluntary cuts for February and March and, if oil prices remain at, or rise above, current levels, Russia will once again push to raise targets.
Source: themoscowtimes, Livemint, Deccanherald, Barrons
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