Agency, Melbourne.
Published by: Jeet Kumar
Updated Fri, 11 Mar 2022 06:29 AM IST
Summary
Amid the supply crunch, the UAE ambassador said he was in favor of increasing production to arrest the rise in crude oil prices. After this statement, Brent crude fell by $2.53, or 2.28 percent, to $113.67 a barrel.
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Expansion
Actually, the supply of crude oil has been affected due to the ongoing war between Russia-Ukraine. Due to this, crude oil reached a 14-year high of $ 139.13 per barrel on March 7, 2022.
Amid the supply crunch, the UAE ambassador said he was in favor of increasing production to arrest the rise in crude oil prices. After this statement, Brent crude fell by $2.53, or 2.28 percent, to $113.67 a barrel. WTI fell $1.64, or 1.51%, to $110.34.
nIndia will get relief
India will benefit more from UAE’s decision to increase crude oil production. India imports 85 per cent of its crude oil consumption. Recently, the price of crude oil had reached $ 139 per, due to which there is a possibility of a big increase in the prices of petrol and diesel in the country.
According to an estimate, the government oil companies are incurring losses due to the decision not to increase the retail price of petrol and diesel despite the increase in crude oil prices.
Expected to increase production by 8 lakh barrels
Experts say that the UAE can immediately increase the production of 8 lakh barrels of oil. This will make up for a seventh of the supply shortfall from sanctions imposed on Russia. In the coming times, supply from Iran is also expected to increase, which is expected to provide further relief on the crude oil price front.
negative impact on demand
Producing countries also fear that the rise in oil prices will have a negative impact on demand. Experts said, if the economy slows down due to expensive crude, then crude oil prices will fall further. So OPEC countries can increase production.