NEW DELHI: Pump prices are likely to see moderate rise after the recent spell of decline as OPEC, the grouping of 14 oil exporting countries accounting for about 38% of global supplies, on Thursday agreed to deepen production cut by 1.5 million bpd (barrels per day) to lift prices hammered by falling demand as the coronavirus outbreak infects economic activities in more and more countries.
The effectiveness of the deepest oil production cut since the 2008 global financial crisis will depend on the outcome of Friday’s meeting of the ‘OPEC+’ grouping that includes other non-OPEC producers such as Russia. As a non-OPEC exporter, Moscow pulls a hefty punch in the oil market and has to sign up for the cut to have the desired effect.
OPEC also agreed to extend the existing cut of 2.1 million bpd till the end of 2020. Russia has so far shown little appetite for deepening the cut but Moscow is known to keep the Saudi Arabia-led grouping guessing till the last minute.
