WTI Jumps 3.4% after a Surprise 1M bpd Extra Cut from Saudi Arabia!

Oil price edged higher on Monday trading session after Saudi Arabia voluntarily cut its production by an additional 1 million barrel per day (bpd) starting in June to stabilize the global oil market.

 

West Texas Intermediate rose as much as $0.84/bbl or 3.39% to $25.58/bbl, while the international benchmark Brent crude dipped $0.50/bbl or 1.61% to $30.47/bbl.

 

Saudi Arabia announced on Monday that the kingdom will further cut its production by an additional 1 million bpd starting in June to support the stability of global oil markets. With this additional cut, the Kingdom will produce 7.5 million bpd in June, down from the almost 12 million bpd production capacity of Saudi Arabia.

“The Kingdom aims through this additional cut to encourage OPEC+ participants, as well as other producing countries, to comply with the production cuts they have committed to, and to provide additional voluntary cuts, in an effort to support the stability of global oil markets,” a statement from the Saudi press agency said.

Oil prices started to recover from their earlier plummet from price war and lower demand due to the coronavirus outbreak. Last week, WTI had one of the greatest weeks with a jump of 25%, while Brent rose 17%.