March 16, 2020 / 5:30 PM / 4 months ago

Developing nations may lose up to 85% of oil and gas income this year: IEA, OPEC

FILE PHOTO: The logo of the Organisation of the Petroleum Exporting Countries (OPEC) sits outside its headquarters ahead of the OPEC and NON-OPEC meeting, Austria December 6, 2019. REUTERS/Leonhard Foeger/File Photo

LONDON (Reuters) - Developing nations’ oil and gas income will fall by 50% to 85% this year to a more than two-decade low if current market conditions persist, the International Energy Agency and OPEC said in a rare joint statement on Monday, citing recent IEA analysis.

This is likely to have “major social and economic consequences”, notably for public sector spending in vital areas like healthcare and education, the statement from IEA director Fatih Birol and OPEC secretary-general Mohammad Barkindo said.

Oil prices slid below $30 a barrel on Monday as the global spread of coronavirus became more entrenched, leading to lockdowns as the global economy appeared to be headed toward certain recession.

The oil price rout was exacerbated by the collapse of an alliance between the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia which had been withholding production from the market.

The statement did not expressly mention the alliance’s leaders Saudi Arabia and Russia, which have started a price war for market share, but called for market stability.

Reporting by Ahmad Ghaddar; Editing by Jan Harvey

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