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OPEC+ agrees deep cuts to oil production
The decision to reduce oil output by 2 million barrels per day was made by OPEC and its allies, collectively known as OPEC+, a coalition of the world's top oil-producing nations.
This is the biggest decrease since the Covid-19 outbreak started.
Following Russia's invasion of Ukraine in February, oil prices surged, but have since started to decline over the next few months.
Due to worries about a European recession and decreased demand from China as a result of its lockdown measures, it fell to $90 in September 2022.
Members of OPEC+ are worried that a deteriorating global economy would result in a decline in oil demand, and the cuts are seen as a method to safeguard earnings.
Additionally, experts have suggested that Russia may be pushing OPEC to hike prices for the West.
It will be more difficult for Europe to move forward with its sanctions against Russian oil in December as prices climb.
The European Union recently stated its intention to impose a price ceiling on Russian oil exports.
Countries will be allowed to buy Russian oil and petroleum products delivered by sea as long as the price is at or below the cap, according to the plan.
The new agreement to cut back on supplies, however, is likely to keep oil prices high globally, allowing Russia to continue aiming for substantial profits from its crude export.
Russia has been accused by the West of turning energy into a weapon, sparking a crisis in Europe that could lead to gas and power rationing this winter.
Moscow claims that as revenge for the invasion of Ukraine in February, the West turned the dollar and financial systems like SWIFT into weapons.
Since its inception in 1960 by Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela, OPEC has grown to include 13 nations.
The alliance is now known as OPEC+ and includes 11 additional significant oil-producing allies, including Russia.
OPEC+ is made up of 24 countries that produce oil.
A accord to coordinate oil production among the nations in an effort to stabilise prices gave rise to the OPEC+ arrangement in 2017.
Saudi Arabia, the greatest oil producer in the OPEC bloc, serves as its nominal leader. Russia, on the other hand, is the dominant non-OPEC nation.
Source: The Indian Express