Vienna: The Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC countries (OPEC Plus) have agreed to significantly cut oil production, ignoring pressure from other countries including the United States. Under the agreement, oil production will be cut by 2 million barrels per day.
Sources told that this consensus was reached in a meeting held in Vienna. Saudi Arabia and Russia are the main countries in OPEC Plus.
It should be noted that in 2020, a significant reduction in oil production has been agreed for the first time after the Covid-19 pandemic.
Interestingly, this consensus has been reached at a time when the oil market is already shrinking, but experts say that this will help to restore oil prices in the global market.
Due to economic recession in the global market, rising interest rates in the United States and the fear of a strong dollar, the price of oil per barrel has dropped to around 90 dollars, while only three months ago the price of crude oil was 120 dollars per barrel in the world market.
According to media reports, if oil prices rise due to massive production cuts, it is likely to cause serious trouble for the Biden administration ahead of the mid-term elections in the United States.
According to experts, this decision may also cause an increase in the tension of OPEC plus countries with Western countries.
According to reports, the move by the U.S. could trigger a political backlash, including further releases from the strategic stockpile and wild cards, while JP Morgan says Washington will retaliate by releasing more oil.
Comments are closed.