New Delhi | Jagran Business Desk: Petrol and diesel prices reached an all-time high in India on Monday after the seventh consecutive hike. As of October 11, petrol and diesel rates in national capital Delhi stand at Rs 104.44 and Rs 93.17 respectively. The fuel rates were on the rise in India since May this year but had stabilised in August and September. However, with the beginning of the festive season in India, the prices are soaring once again across the country.
Market experts have blamed the volatile situation in the international market that has led to a rise in bench crude. Currently, bench crude has crossed the USD 82 per barrel mark and is expected to continue to rise as the Organisation of the Petroleum Exporting Countries (OPEC+) -- which includes Russia and its allies -- have decided not to increase their output more than 0.4 million barrels per day.
In July this year, OPEC+ had agreed to boost output by 400,000 bpd a month until at least April 2022 to phase out 5.8 million bpd of existing production cuts. However, demand has increased again with the world economy bouncing back following the upliftment of COVID-19 lockdowns in most of the countries.
Though OPEC+ is receiving calls from the United States (US) and India -- two of its main consumers -- to increase the output, it has "reconfirmed the production adjustment plan" for November. "We are scared of the fourth wave of corona; no one wants to make any big moves," Reuters quoted an OPEC+ source as saying.
Market experts have warned that OPEC's decision would have a severe impact on crude rates, especially because the winter is approaching in the northern hemisphere. They have said that OPEC+ is facing a "much tighter supply market", warning that a "constrained supply chain" can lead to an energy crisis across the world.
"Absent a significant change of course by OPEC+ to its current production plan, which we now know there won’t be, the current climb in prices is likely to continue," deputy director of Atlantic Council’s Global Energy Center Reed Blakemore told Al Jazeera.
However, Blakemore feel that the OPEC+ might need to reconsider its decision if fuel rates continue to rise across the globe. It must be mentioned here that the OPEC+ is scheduled to meet again on November 3.
"If we get to the next meeting and prices are still climbing, then there will be significantly more pressure for OPEC+ to intervene," Blakemore told Al Jazeera.
Posted By: Aalok Sensharma