[Economics] Oil prices rise 5% after announcement of production cut

[Draeno]

 

Oil prices rose sharply this Monday after several key players in the market, such as Saudi Arabia, Iraq and Russia, announced a cut in their production as a "precautionary measure" after the recent fall in prices.

The North Sea Brent barrel rose 5.31% to $84.13 and the US benchmark, WTI, rose 5.38% to $79.74.

So far this Monday, April 3, both indices have recorded increases of close to 8%.

The production cut announced on Sunday by Iraq, Algeria, Saudi Arabia, the United Arab Emirates, Oman, Kazakhstan and Kuwait will take effect in May and will last until the end of the year.

In total, it implies a drop in production of one million barrels per day.

For its part, Russia announced on Sunday that it is extending the cut in its crude production by 500,000 barrels per day until the end of the year.

The announcements came ahead of a videoconference meeting of a ministerial panel of the Organization of the Petroleum Exporting Countries and its Allies (Opec+), a cartel led by Saudi Arabia and Russia.

Instead, the United States advocates increasing production in the face of increased demand at a time when China revived its economy after lifting restrictions due to the pandemic.

This announcement revives fears about persistent inflation and adds more pressure on central banks to continue raising interest rates.

 

https://www.portafolio.co/economia/finanzas/precios-del-petroleo-hoy-3-de-abril-de-2023-brent-wti-y-opep-580874