- Supported by Saudi Arabia's commitment to further reduce its production by 1 million barrels per day in July, oil prices began the week on an upward trend, aiming to stabilize the market. Saudi Energy Minister Prince Abdulaziz bin Salman emphasized the willingness to take necessary measures for market stability after a tense OPEC+ meeting. As a result, West Texas Intermediate initially surged nearly 5%, settling around $73 per barrel later in the session.
- Last month, oil prices in New York experienced an 11% decline due to demand worries, particularly in China. Despite market expectations of OPEC+ maintaining output levels, the outcome of the gathering in Vienna was seen as "moderately bullish" by Goldman Sachs analysts.
Why it matters
Saudi Arabia's move to stabilize prices may come at the cost of market share, while other OPEC+ members commit to maintaining current cuts. The OPEC+ deal was delayed by disputes over cut measurements with African members. The extension of the additional cut next month remains uncertain as Saudi Arabia aims to keep the market in suspense.
