Oil prices on Monday (07 August 2023) surged to their highest levels since mid-April, after top producers Saudi Arabia and Russia pledged to extend supply cuts through September, further tightening supplies.
In intra-day trade, Brent crude was trading at 85 dollars and 34 cents per barrel. West Texas Intermediate crude price was at 81 dollars and 92 cents per barrel when reports last came in.
Several factors have underpinned prices in recent weeks including expectations of U.S. interest rate hikes tapering off and a reduction in OPEC supplies. It is further supported by hopes of stimulus boosting oil demand recovery in the world’s top crude importer China after a dismal second quarter. Saudi Arabia’s comments that the cuts may be deepened beyond September has already caught the attention of the market.