Oil prices rose on Monday after top exporters Saudi Arabia and Russia reaffirmed their commitment to further voluntary oil supply cuts by the end of the year.
Brent crude futures were up $1, or 1.2%, at $85.89 a barrel at 17:13 GMT, while U.S. West Texas Intermediate crude was up $1.11, or 1. 4%, to $81.62.
Saudi Arabia confirmed on Sunday that it will continue its additional voluntary cut of 1 million barrels per day (bpd) in December to keep output around 9 million bpd, the energy ministry said.
Russia also announced it would continue its additional voluntary cut of 300,000 bpd from its crude oil and oil product exports until the end of December.
“Russia and Saudi Arabia have an iron-clad agreement to stay with the same supply constraints until the end of the year, and yet demand for fuel is still stronger than most analysts expected, keeping a good supply under crude oil prices,” Dennis said. Kissler, Senior Vice President of trading at BOK Financial.
Reading Oil steady as supply cuts face surprise
The cuts could extend until the first quarter of 2024 due to “seasonally weaker oil demand at the start of each year, continued concerns about economic growth and the aim of producers and OPEC+ to support oil market stability and balance” , said UBS strategist Giovanni. Staunovo. Oil prices rebounded after both benchmarks lost about 6 percent in the week to Nov. 3, as supply concerns sparked by Middle East tensions eased.
Monday’s gains in oil prices may have been capped by easing crude shipments to Chinese refiners.
Refinery work is falling from record levels in the third quarter due to shrinking margins and a lack of export quotas through the end of the year, traders and industry consultants told Reuters.
“The reaction to decisions by Saudi Arabia and Russia over the weekend to extend their respective output and export cuts through December was offset, to some extent, by an expected decline in China’s refinery output this month,” said the analyst. PVM Tamas Varga.
Published in The Express Tribune, November 7u2023.
a href=”https://tribune.com.pk/story/2445140/oil-up-as-saudi-arabia-and-russia-stick-to-supply-cuts”>Source link