Saudi Arabia and Russia announced on Tuesday an extension of their oil production cut, a move that led to an increase in oil prices and further demonstrates synchronicity between the two countries.
A source in the Saudi Ministry of Energy said the kingdom will extend its voluntary cut of 1 million barrels per day (bpd) until the end of December. The decision was made in order to ensure “stability” in oil markets and will be reviewed monthly in order to “consider deepening the cut or increasing production,” the official Saudi Press Agency reported.
Russia also announced an extension of its voluntary cut of 300,000 bpd until the end of the year. This decision will also be reviewed on a monthly basis, Deputy Prime Minister Alexander Novak told reporters, according to the official Tass news agency.
The price of Brent crude oil, considered the global benchmark for oil prices, jumped 2% to $91.08 at 11:42 a.m. ET on Tuesday following the announcements. This was the highest price since November of last year. As of 1:50 p.m. ET, the price was around $90.40, per market data.
