New Delhi: A day after Qatar's exit from Organisation of the Petroleum Exporting Countries (OPEC), Hindustan Petroleum Corporation (HPCL) Chairman and Managing Director MK Surana has assured that while oil prices may go up, they will stay well below $70 a barrel for the rest of the current financial year.

The statement came after Brent crude prices increased by 2.76 percent to $62.22 a barrel at one point on Monday, putting a stop to the recent declining trend. Surana said, "The exit of Qatar is depending on the individual interests of the country. Despite all the geo-political situations, prices will still be below $70 a barrel for the rest of this financial year."

"The sharp slump in crude prices over the past few weeks amid fears of oversupply may reverse gradually, if Opec is able to pull off a production cut of around 1-1.5 million barrels per day in its upcoming meet next week, which we believe will be adequate to balance the market in CY2019"

Qatar decided to pull out of OPEC by January 1, 2019 to focus on gas production. An OPEC meeting that is scheduled to take place this week is expected to come up with a supply cut to arrest the drop in prices. "The sharp slump in crude prices over the past few weeks amid fears of oversupply may reverse gradually, if Opec is able to pull off a production cut of around 1-1.5 million barrels per day in its upcoming meet next week, which we believe will be adequate to balance the market in CY2019," said a report by Kotak Institutional Equities. The report also added that the supply surplus may also taper off on the plausible imposition of full sanctions on Iran's crude exports by the US government from early-May 2019.

In October, the government was forced to cut excise duty by Rs 1.5 a litre, while oil marketing companies absorbed Rs 1 a litre after crude oil prices had climbed above $80 a barrel, resulting in a corresponding rise in fuel prices in the domestic market.