Viena : In a crucial development, the Organization of Oil exporting Countries (OPEC) and Non-OPEC Oil producing counties like Russia on Friday agreed to boost Crude Oil production by 1 million barrels per day (Bpd). The decision to increase production is expected to ease the Oil prices worldwide.
The decision by the Oil exporting countries to raise production will also ease the pressure on the Indian Government, which is facing people’s wrath owing to high Petrol and Diesel prices in the domestic market.
The OPEC and non-OPEC Countries are gathering in Vienna amid calls from the United States, China and India to cool down the price of crude and prevent an oil deficit that would hurt the global economy. OPEC in theory needs the agreement of all members to clinch a deal but has in the past agreed production pacts without Iran, which has criticized the idea of raising supply as it faces export-crippling U.S. sanctions. However, this time it seems the OPEC leader Saudi Arab has managed to persuade the Iranian Oil minister Bijan Zanganeh.
“Hope OPEC will increase output substantially. Need to keep prices down!” the US president Donald Trump tweeted just half an hour after the decision.
Hope OPEC will increase output substantially. Need to keep prices down!
— Donald J. Trump (@realDonaldTrump) June 22, 2018
The one-million-bpd figure is theoretical only, Saudi Energy Minister Khalid al-Falih was quick to note. The actual increase will likely be closer to 600,000 bpd, he said, as not all OPEC members have the spare capacity to raise production. The most obvious example here is struggling Venezuela, but Iraq is also opposed to any production increase. Mexico, a non-member but a signatory of the deal, also can’t boost its production at the moment.