Oil prices witnessed a rise on Monday as Saudi Arabia and Russia, the world’s top two oil exporting countries, reaffirmed their commitment to continue voluntary output cuts until the end of the year. This move is intended to restrict oil supply while investors anticipate stricter U.S. sanctions on Iranian oil.
Brent crude futures surged by 41 cents, equivalent to 0.5 percent, reaching $85.30 per barrel. Similarly, U.S. West Texas Intermediate (WTI) crude rose by 54 cents, or 0.7 percent, to $81.05 per barrel.
Saudi Arabia and Russia have declared their intention to voluntarily reduce oil production until December 2023.
Following a downward trend in the first three days of the previous week, oil prices began to recover as both the Federal Reserve and the Bank of England (BoE) opted not to raise interest rates.
Read more: OPEC+ holds oil policy steady, Saudi and Russia extend voluntary cut
The Saudi Ministry of Energy, as reported by the Saudi Press Agency (SPA), has confirmed that the Kingdom will continue its voluntary reduction of 1 million barrels per day (BPD). This reduction was first implemented in July 2023 and has now been extended until the end of December.
According to projections, Saudi’s oil production is anticipated to reach around 9 million BPD in December 2023.
At its 50th meeting on October 4th, the Joint Ministerial Monitoring Committee of OPEC+ restated the dedication of member states to the Declaration of Cooperation. This entails the reduction of oil production levels until the conclusion of 2024, as initially agreed upon during the OPEC alliance Ministers’ Meeting held in June.
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