The barrel of oil rebounds, Saudi Arabia and Russia in support

(Boursier.com) — Crude prices are rebounding at the start of the week, supported by announcements from Saudi Arabia and Russia. These two major exporters of black gold reaffirmed on Sunday their intention to continue reducing their extractions until the end of the year. The barrel of Brent for January delivery rose 1.35% to $86 in London while the barrel of WTI for December delivery gained 1.55% to $81.8 in electronic exchanges on the Nymex.

Riyadh therefore confirmed that it would continue its additional voluntary reduction of one million barrels per day in December to maintain its production at around 9 mbd, the Kingdom said. Russia, for its part, announced that it would continue its additional voluntary reduction of 300,000 bpd in its exports of crude oil and petroleum products until the end of December. ING analysts estimate in a note that the oil market will be in surplus in the first quarter of next year, “which could be enough to convince the Saudis and Russians to continue the cuts.”

Sunday’s announcement by the two OPEC+ heavyweights came after a reduction in the risk premium linked to the war between Israel and Hamas and concerns about weaker global demand led to a decline in oil prices. oil by more than 6% last week. Although it is still possible that the conflict could spread across the region, the weakening global economic outlook has now become the main factor weighing on prices.

A surprise contraction in China’s manufacturing sector last month raised questions about the recovery of the world’s largest oil importer as U.S. inventories rise. Even the falling dollar, which makes oil cheaper for most buyers, hasn’t been enough to stop the slide. “It will likely be a slow and bumpy recalibration for crude oil as it sheds the risk premium from the Israel-Hamas conflict and recouples with economic sentiment,” Vandana Hari, founder of Vanda Insights, tells ‘Bloomberg’. “The only relative certainty concerns supply, with OPEC+ keeping its production targets stable until the end of the year.”