- Furthermore, Russia has declared a voluntary decrease of 500,000 bpd by the end of 2023.
- The announcement of production cuts has led to a rise in crude oil prices, with Brent prices increasing up to $5 a barrel within a day.
- The prices of oil have been erratic in recent months and surged after the Russia-Ukraine conflict, dropping to as low as $70 a barrel in March 2023 due to concerns of a potential global banking crisis that could harm demand.
- OPEC is responsible for nearly 40% of the world's crude oil production, and its member countries' exports account for roughly 60% of the world's petroleum trade.
- Due to the reduction in oil production and subsequent increase in prices, India, which imports around 85% of its crude oil requirement, is likely to face a higher import bill.
- This could lead to inflation, wider current account deficit (CAD) and fiscal deficit, as well as a weaker rupee against the dollar. Moreover, it could also negatively impact stock market sentiment.
- OPEC, established in 1960, initially had five founding members: Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela.
- Since then, it has grown to include 13 member countries, including Algeria, Angola, Congo, Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia, United Arab Emirates, and Venezuela. The headquarters of OPEC is located in Vienna, Austria.
- In 2016, OPEC expanded its membership to include 10 other major oil-producing countries, and the organization became known as OPEC+. The 13 OPEC member states were joined by Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia, South Sudan, and Sudan.
Question:
Q.1 When was OPEC established?a. 1950
b. 1960
c. 1970
d. 1980
