Crude prices experienced a rise at the start of the week, continuing the upward trend seen at the end of last week. This increase is a result of Saudi Arabia’s decision to extend voluntary output restrictions into the following year, as reported by the Financial Times. Furthermore, other members of the Organization of the Petroleum Exporting Countries (OPEC) are contemplating additional cuts.
Last week, prices had reached a four-month low, marking a fourth consecutive week of decline. These declines were primarily driven by concerns surrounding weakened global energy demand amidst a struggling economy. Additionally, there was relief that the ongoing conflict in the Middle East had not directly affected major oil-producing countries like Saudi Arabia or Iran. Moreover, the accumulation of inventories in storage facilities in Cushing, Okla., also contributed to the downward pressure on prices.
However, there seems to be a shift in sentiment now. Reports suggest that OPEC members are not only concerned about falling prices but also expressing dissatisfaction with the ongoing Israel-Hamas war and the dire humanitarian conditions in Gaza. These discussions were cited by unidentified sources familiar with the matter.
As of early Monday, Brent crude, the international benchmark, rose 0.8% to $81.22, while West Texas Intermediate, the U.S. standard, also experienced a similar increase of 0.8% to $76.53.
The next OPEC meeting is scheduled for November 26 in Vienna.
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