Oil rises after Saudi Arabia and Russia confirm supply cuts

Oil prices rose after Saudi Arabia and Russia reaffirmed their commitment to reducing oil supplies by more than 1 million barrels per day (bpd) through the end of the year.

World benchmark Brent crude traded above $85 per barrel, while WTI was close to $81.

The announcement by the two heavyweights of OPEC+ came after the uptick resulting from Israel-Hamas war fears and fears about weak global demand faded, sending oil prices down more than 6% last week.

Crude oil prices rose after Hamas’s attack on Israel on October 7, but these gains have now been almost completely squandered as the war continues to be contained and supplies from the Middle East, which is the source of about a third of the world’s oil.

While the opportunity for conflict to spread throughout the region remains, weak global economic prospects are now the main driver of prices. The sudden contraction in China’s manufacturing sector last month raised questions about the recovery in the world’s largest oil importer, while U.S. stocks grew.