Oil Price Hike to 4% after OPEC+ Trims Output by 100k per day

oil price hike

There is an oil price hike of 4% on Monday after OPEC+ crude producers agreed to cut output quotas and Russia said it won’t sell its exports to countries that abide by a US-led planned price cap.

Members of the Organization of Petroleum Exporting Countries and their allies agreed at a meeting Monday to reduce production by 100,000 barrels a day from October, surprising analysts who widely expected the group to maintain current levels. Leading oil exporter Saudi Arabia floated the idea last month to ease pricing dysfunction in the oil market.

Brent crude futures, the global benchmark, were up 4.0% at $96.77 at last check, while WTI crude futures, the US benchmark, were 3.8% higher at $90.19.

Oil prices have slid about 20% from their June highs, in part because of growing concerns about a global recession that would knock demand. An OPEC+ cut to supply levels, even if small, could help support oil prices.

The group said it was returning quotas back to August levels because its previously agreed addition of 100,000 barrels a day in September was intended for that month only.

Oil market analysts had largely expected no change to supply from OPEC+, giving as one factor the uncertainty around whether the Iran nuclear talks would add more barrels to the market.

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