Petrol and diesel may be cheaper in the coming days. No no no Neither the central government nor the state governments are going to cut taxes on petrol and diesel, or fuel prices will not cover the GST. Standard Brent crude oil per barrel as of Monday afternoon. Let us tell you that it is trading as 72.62.
In fact, five non-OPEC countries will increase crude oil production by August. The full agreement was reached on Sunday between OPEC and the Allies. Oil prices have been affected by the dispute between these countries in the past. In a statement released after an online meeting of the Organization of Oil and Exporting Countries and its partner producer countries, the oil production limit in Iraq, Kuwait, Russia, Saudi Arabia and the UAE will increase. Russia is an ally of the OPAC.
The increase will be 400,000 barrels per month
OPEC states that it will increase production by 400,000 barrels per month from August, and therefore the current applicable 5.8 million barrels / day reduction will be gradually eliminated by the end of 2022. After the online meeting, United Arab Emirates (UAE) Energy Minister Suhail-al-Majraoui informed journalists (wholly unanimous). Although he did not immediately provide details, Saudi Arabia’s Energy Minister Prince Abdullah Ziz bin Salman has said that the production limit will be adjusted between the groups.
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Then, in a statement from OPEC, the deal was announced to increase the production levels of the five countries. Under the newly set production limit, the UAE will be able to produce 3.5 million barrels per day from May 2022. According to reports, the UAE had previously sought a 3.8 million barrel / daily production limit. Similarly, Saudi Arabia’s daily production limit will be increased from 1100 million barrels to 11.5 million barrels. The Russian production limit remains the same.
The increase in the daily production limits of Iraq and Kuwait is less than this. OPEC’s statement acknowledges that oil prices have been steadily rising. It said economic activity is improving as vaccination programs intensify in most parts of the world. Earlier this month, the UAE broke talks on production as it wanted to increase its own production levels. This increased tensions between the UAE and Saudi Arabia.
Al Majraoui said, “The UAE is committed to this group and will always work with it. We will do our best to balance the market and help everyone. He declined to elaborate on how it was reached.
He said, ‘By saying this, the benefit of this alliance is lost because of secrecy and intelligence. Crude oil prices have plummeted due to reduced demand for jet fuel and automotive fuel amid the corona virus epidemic. Demand has improved after the pace of vaccination in the world’s major economies.
Prices go up due to reductions in production
India is the world’s third largest oil consumer and imports 85% of its requirements. Certainly any drop in the price of oil will reduce its import bill. If governments don’t raise their taxes, petrol and diesel prices will start to decrease. The last time crude oil prices were declining between 2014 and 2016, instead of delivering profits to the general public, the government was busy filling its treasury with a maximum tax on petrol and diesel in the form of excise duty. According to official figures of July 1, the tax on petrol in Delhi is 33.29 per cent and 23.07 per cent from the state government. Similarly, as excise duty on diesel, the central government levies more than 35.66 per cent, while the state government levies 14.62 per cent.
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Let us tell you that the price of crude oil in 2016 was less than $ 30 per barrel. This alliance enlisted the help of a large country like Russia to lift the market. OPEC and its allies, Russia, agreed to cut daily crude oil production by 10 million barrels by 2020. This was followed by a gradual increase in production by 42 lakh barrels. Currently, a reduction of 58 lakh barrels per day is applicable.