New Delhi: Since the year 2020 started, the condition of the oil and energy market has deteriorated. Even before the arrival of Coronavirus, the whole world was going through a phase of global slowdown. Now historic demand shock sparked by the coronavirus pandemic is set to worsen in the current quarter. The global demand for oil and energy has drastically declined due to the Corona epidemic.
- Crude oil prices could plunge below $20 a barrel in the second quarter, according to CNBC survey.
- Some analysts believe crude oil prices could fall to as low as $10 a barrel as the coronavirus outbreak has severely dented demand.
- Any coordinated effort by heavyweight producers Saudi Arabia, Russia and the United States to cut supply aggressively and rebalance the market, according to a CNBC survey.
Crude oil prices fall as ‘OPEC+’ delays meet on output cut
Crude oil prices declined on Monday as OPEC and other major oil producers including Russia delayed their meeting to discuss on output cuts.
Brent crude fell near to $30 per barrel during early trade on Monday. Currently, it is trading at $33.51, lower by 1.76 per cent from its previous close.
The WTI crude plunged over 3 per cent to $27.37 per barrel.
World’s leading oil producers were scheduled to meet on Monday to discuss output cuts, but the meeting has been postponed to April 9.
Late last week, crude prices soared, on hopes that OPEC and its allies would strike a deal to cut crude supply worldwide by at least 10 million barrels per day (bpd).
In early March, talks between OPEC and Russia for crude production cuts fell apart triggerring a bloodbath in oil market.
It was reminiscent of the Cold War days when the mistrust between Soviet Union and the US kept the world on the brink.
Talks between oil cartel Organization of Petroleum Exporting Countries (OEPC) and Russia had collapsed as the two sides failed to agree on an output cut deal.
How Oil Prices Impact Indian Economy
States’ earnings will decrease: According to the research report, the states will suffer loss due to decreasing crude prices. Earnings from Petroleum VAT (Value Added Tax) will decrease. Due to this, states can increase VAT on petrol and diesel.
With input Agency