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OPEC and rising oil prices.

  Jul 21, 2021

OPEC and rising oil prices.

Q. Why is this in news?
A.
India is working to persuade oil exporting countries to moderate surging oil prices and warned that high prices would push the country to tap alternative import sources such as Iran. 
Q. What are the Current Challenges being faced by India?
A.
  1. With retail prices for petrol crossing ₹100 a litre in several States, ‘today’s price is very challenging’. 
  2. International oil prices have risen past USD 75 per barrel in recent days — highest since April 2019 — on consumption recovery as well as supplies being short of demand. 
  3. High oil prices are adding to inflationary pressures. 
  4. Exhausting the strategic petroleum reserves it had built up last year by taking advantage of lower oil prices. 
  5. Increasing central and state taxes on petrol and diesel are also the key reason for the prices of petrol and diesel being at record highs. 
  6. India’s oil demand has also risen by 25% in the last seven years – more than any other major buyer. 
Q. What is the Impact of OPEC?
A.
OPEC nations such as Saudi Arabia have traditionally been its principal oil source. But OPEC and its allies, called OPEC+, ignoring its call for ease supply curbs had led to the world’s third-biggest oil importer tap newer sources to diversify its crude oil imports. 
Q. What about India’s oil imports?
A.
  1. India is the world’s third-largest consumer of crude. 
  2. Saudi Arabia is India’s second-largest supplier after Iraq. 
Q. What is India’s Plan on strategic Petroleum reserve?
A.
Indian Strategic Petroleum Reserves Ltd (ISPRL), has constructed three strategic petroleum reserves in huge underground rock caverns at Visakhapatnam (1.33 MMT) on the East Coast, and at Mangaluru (1.5MMT) and Padur (2.5 MMT) on the West Coast.