Global banking crisis: Low prices to brighten prospects of OMCs

While prices sustaining lower levels is crucial, Govt actions are also a key monitorable given the forthcoming elections in 2024

One consequence of the recent turmoil in global banking has been a sharp drop in commodity prices. Oil, in particular, has seen a dip with most analysts focussed on likely fall in global demand.

Although this is an early reaction, it could be a trend. On the other hand, OPEC+ (OPEC members plus Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia, South Sudan and Sudan which are oil-exporters but not OPEC members) is running production at below target. Hence, cuts in supply could stabilise oil prices or slow a downtrend.

The impact of lower prices on India is generally positive