Saudi Arabia and its allied oil-producing countries announced Sunday that they will extend their oil output cuts through December, delaying plans to gradually increase production.
The eight members of OPEC+ had originally planned to start unwinding their 2.2 million barrels-per-day production cut at the end of this month. However, they now say they will hold off on this increase until January 2024.
The decision comes after a previous delay in October, driven by concerns over falling oil prices and weak global demand. While no official reason was given for the latest extension, analysts suggest that the timing may be linked to the upcoming U.S. presidential elections on Tuesday. Additionally, market participants are awaiting potential developments regarding Iran’s response to recent Israeli attacks.
The announcement led to a 3% increase in oil prices during early trading on Monday.
