The Indian basket of crude oils went below the psychological $50-a-barrel-mark this week as global prices fell on the back of a supply glut from rising US crude inventories, offsetting some of the output cut efforts from the Organisation of the Petroleum Exporting Countries (OPEC).
As per available data, the Indian basket, comprising 73 per cent sour-grade Dubai and Oman crudes, and the balance in sweet-grade Brent, closed trade on Thursday at $49.64 for a barrel of 159 litres, which was marginally higher than the previous day's close at $49.44.
The US Energy Information Administration said on Wednesday that the country's crude inventories climbed by almost 5 million barrels to 533.1 million last week.
Analysts said the rising output also weighed on the production reduction by the OPEC and its allies.
The West Texas Intermediate for May Delivery erased $0.34 to settle at $47.70 a barrel on the New York Mercantile Exchange, while Brent crude for May delivery decreased $0.08 to close at $50.56 a barrel on the London ICE Futures Exchange.
According to the latest OPEC data, its reference basket of 13 crude oils closed at $48.35 a barrel on Thursday.
Last November, major oil producers agreed to cut output as a response to the global supply glut that had been pushing down prices for nearly two years.
In early December, oil producers outside the Organisation of the Petroleum Exporting Countries (OPEC), led by Russia, agreed to reduce output by 558,000 barrels per day (bpd). This came in the wake of the 13-nation OPEC cartel's November 30 decision to cut output by 1.2 million bpd for six months effective from January 1.
This is the first time since 2001 that OPEC and some of its rivals had reached a deal to jointly reduce output to tackle the global oil glut.
Oil prices had earlier fallen by more than 50 per cent in less than two years, from levels of over $120 a barrel.
Indian oil marketing firms revise prices fortnightly and rates were last revised more than two months ago on January 16, with hikes on petrol by 42 paise a litre, and on diesel by Rs.1.03, both in Delhi and with corresponding increases in other states.
Petrol per litre costs Rs.71.14 in Delhi, Rs.73.66 in Kolkata, Rs.77.96 in Mumbai and Rs.70.61 in Chennai.
Similarly, diesel costs Rs.59.02 in Delhi, Rs.61.27 in Kolkata, Rs.64.89 in Mumbai and Rs.60.73 in Chennai.