By Adedapo Adesanya
The Organization of the Petroleum Exporting Countries (OPEC) daily basket price stood at $43.14 per barrel on Monday.
The price dropped 24 cents or 0.55 per cent at the markets on Monday from $43.38 the previous day’s session, according to OPEC Secretariat calculations released on Tuesday.
Also known as the OPEC reference basket of crude oil, the OPEC basket, a weighted average of oil prices from different OPEC members around the world, is used as an important benchmark for crude oil prices.
The OPEC Reference Basket of Crudes is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Djeno (Congo), Zafiro (Equatorial Guinea), Rabi Light (Gabon), Iran Heavy (Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela).
The price drop yesterday can be seen as the effect of concerns about escalating tensions between the world’s two biggest economies, the United States and China following the closures of consulates in Houston and Chengdu.
This followed a continuous rise in the global coronavirus cases which is spurring fresh lockdowns in Asia and other parts.
In other OPEC related news, The OPEC Fund for International Development (OFID) has approved $75 million to support socio-economic development and COVID-19 recovery efforts in several developing countries.
According to the Fund, a $15m public sector loan to Rwanda will support businesses in the sectors most affected by COVID-19 and help safeguard development gains made in the past two decades.
The facility will enable the restructuring of existing bank loans to tourism-related businesses through the National Bank of Rwanda, and provide lines of credit to large corporates, MSMEs, and savings and credit cooperatives.
It will also support a Business Development Fund for vulnerable people engaged in informal work.
Also approved was $60 million under the OPEC Fund’s Private Sector and Trade Finance Facility. The financing will support SMEs in Asia and Latin America as they respond to the impact of COVID-19 while another will strengthen agricultural supply chains, which have been especially hard hit by the pandemic in African countries.
Commenting on the funding, OPEC Fund Director-General, Mr Abdulhamid Alkhalifa said, “We are mobilising both public and private sector development finance solutions to help our partner countries respond to the pandemic and meet their needs across different segments of their economies. It is important to be flexible and move quickly in response to developing country needs, now more than ever.”
The OPEC Fund has dedicated $1 billion to collective and coordinated COVID-19-related financial assistance for developing countries.
OFID was established in January 1976 by the then 13 member countries of OPEC; including the United Arab Emirates. It is the development finance institution established as a channel of aid to developing countries.
