Saudi Minister warns of $50 oil as OPEC+ members flout production curbs

News: The Saudi Minister has said that prices could drop as low as $50 per barrel if so-called cheaters within OPEC+ don’t stick to agree upon production limits, according to the delegates in the cartel.

1. Organisation of Petroleum Exporting Countries (OPEC): It is an intergovernmental organisation that was established in Baghdad in 1960 by 5 countries namely Iran, Iraq, Kuwait, Saudi Arabia and Venezuela.

2. OPEC was formed with an objective to coordinate and unify petroleum policies among member countries.

2. Its membership has expanded to include 12 countries which account for almost 30% of world’s oil.

3. OPEC is headquartered in Vienna, Austria.

4. Organisation of Petroleum Exporting Countries Plus (OPEC+): In 2016, OPEC signed an agreement with 10 of the world’s leading non-OPEC oil exporters, including Russia, leading to the formation of OPEC+.

5. OPEC+ was formed as a response to falling crude oil prices, driven by significant increases in US shale oil output.

6. OPEC+ main objective is to regulate the supply of the oil to the global market and its crude output accounts for about 41% of global oil production