OPEC to cut Oil Production
The oil industry with its history of boom and bust has been in the deepest downturn since 2014, if not earlier. The oil prices plunged and fell to a point more than 70% compared to the levels in 2014. The 14 OPEC nations on Wednesday 28th sept 2014 agreed on a common consensus of bringing down the oil production in order to boost the oil prices. In the recent years, the oil prices have stumbled down to the lowest from the peak of 115$ a barrel in 2014 to as low as 28$ a barrel in Jan 2016. This situation has exerted a huge pressure on the energy industry. Therefore this landmark agreement is expected to boost the growth of ailing energy industries that had been hard hit by the global oil price glut.
The cartel says it will be trimming down the production to 33 million barrels per day i.e, to decrease the production by 700.000 barrels per day from its current production. The agreement at this stage does not set any targets for production for any of its member countries. The cartel will iron out details on production targets for each country at its next formal meeting in Vienna on November 30. It has also planned to ask the other oil producing countries not the members of the cartel to help tackle the global oversupply of crude oil. Despite the limitations of the deal, the news has raised hopes of the global oil producers for a positive outcome.With this exceptional decision by OPEC, the oil prices have actually soared by 6% to 50$ a barrel. The US energy stocks have jumped registering a growth of 39% by the energy sector.
Thus with OPEC confirmation on production cap on world’s largest oil producers, oil supply would come in line with the large demand for energy sources. Therefore the will soon surge in the demand for oil tenders, Government oil and gas tenders, International crude oil tenders, Energy tenders, Global energy tenders from the global markets. Growth is also expected to be realised in exploration and production tenders,Petroleum tenders etc.