Crude oil futures witnessed a remarkable surge, closing at a 10-month high on Tuesday, September 5th, in response to the joint announcement by Saudi Arabia and Russia regarding an extension of voluntary oil supply cuts through the end of 2023.
WTI Crude Oil futures soared by $1.14, equivalent to a 1.3% increase, ultimately closing at $86.69 per barrel. This closing price marked the highest level since November 15, 2022. Similarly, Brent Crude futures saw a significant boost, rising by $1.04, or 1.2%, to close at $90.04 per barrel, the highest since November 16, 2022.
This surge in crude oil prices came on the heels of an official statement from Saudi Arabia, which confirmed an extension of voluntary oil output cuts of 1 million barrels per day until the conclusion of the current year. Furthermore, Russia’s Deputy Prime Minister, Alexander Novak, announced an extension of Russia’s oil export cut to the global market by an additional 300,000 barrels per day for the same timeframe.
Adding to the bullish sentiment in the oil market, Goldman Sachs analysts offered their support by predicting that the likelihood of the U.S. economy entering a recession within the next 12 months has dropped to a mere 15%, down from the previously estimated 20%. This positive outlook is attributed to a slowdown in U.S. inflation, which may prompt the Federal Reserve (Fed) to reconsider further interest rate hikes.
Investors are keeping a close watch on today’s release of crude oil stocks data by the American Petroleum Institute (API), with anticipation building ahead of the official crude oil stock figures set to be released by the U.S. Energy Information Administration (EIA) on Thursday. The data releases are expected to provide further insights into the state of the oil market and its potential implications for the future.
In conclusion, the extension of oil supply cuts by Russia and Saudi Arabia has not only led to a surge in crude oil prices but has also generated optimism about the overall economic outlook, potentially reshaping the trajectory of the energy market in the coming months.
The Spot Market is Open
Wednesday, September 6, 2023
| Energy Updated at | USD Price | Change | %Change |
| Crude Oil 12.00 | 86.69 | 0.00 | 0.00% |