OPEC-US price war to benefit billions of masses across globe:PEW

Lahore: The Pakistan Economy Watch (PEW) on Sunday lauded another major oil price cut by the Prime Minister Nawaz Sharif which will positively impact masses and the economy.

The price of oil has fallen for nine straight weeks to $66 per barrel in the international market which merits reduction in prices of essential items and electricity at home, it said.

The burden of surge in the oil price is immediately transferred to the masses by the government while business community quickly calculate the difference to hike prices of their products but process of reduction in the prices is very slow in case of oil fall, said Dr. Murtaza Mughal, President PEW.

Tendency in the business community to keep prices of essentials from dropping add to their profits while depriving masses of the benefit, he added.

Dr. Murtaza Mughal said that oil prices can go down as 12-member OPEC (Organization of the Petroleum Exporting Countries) has started a price was with US oil and gas companies to retain its market share. The OPEC strategy will hurt oil producers with Russia, Iran and Venezuela at the top while benefitting oil importing countries.

In the last few years OPEC and other oil producers gained a lot due to unprecedented oil prices throwing would into deep recession. This also encouraged many to explore this sector. Resultantly many new companies were formed which explored huge quantity of oil and gas in America, Canada, Australia, Carrabin countries and Africa.

This was enough to threaten OPEC which produces 40 per cent of the global oil supply of 75 million barrels per day. Since US oil and gas companies, especially the shale producers, are using costly technologies and new methods, many of them can go bankrupt under existing prices badly damaging American energy revolution. This will give OPEC an opportunity to revise prices upward that will be the beginning of the New Oil Order.