Oil climbs to three-month highs as Russia & Saudi Arabia lead major producers to extend output cuts
International benchmark Brent broke past $43 per barrel for the first time since early March on Monday after major crude exporters decided to keep record production curbs in place until the end of July.
US West Texas Intermediate (WTI) crude jumped to over $40 as trading started this week. While both Brent and WTI gave up some earlier gains, they were still up around one percent as of 6:43am GMT.
The rally comes after the 13 members of the Organization of the Petroleum Exporting Countries (OPEC) and 10 allied oil producers led by Russia, together known as OPEC+, agreed to prolong their agreement to cut global production by 9.7 million barrels per day (bpd) for another month. The cuts represent roughly 10 percent of global oil production.
According to the initial plan signed by the group in April, the curbs were set to be effective in May-June, before tapering to 7.7 million bpd.
The rise in crude prices also comes as de facto OPEC leader, Saudi Arabia, announced that it is raising its monthly crude prices for July. It marked the biggest price increases for crude exports in at least two decades.
Brent price has nearly doubled since major crude producers signed the historic oil accord. However, some analysts say that the latest extension of phase one of the deal fell short of market expectations, as some had hoped that OPEC+ would keep record curbs for an additional three months.
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