Saudi and Russian cuts no game-changer for oil
Oil prices were rising for a fourth session, with output curbs from Saudi Arabia and Russia initially giving fresh momentum to the recent recovery. The Saudis announced a one-month extension to their voluntary one million barrel cut, taking the reduction to the end of August which was swiftly followed by Russia announcing that it will cut exports by 500,000 barrels per day next month.
That the market rallied only a little over 1% on the announcements, before giving it back, suggests traders don’t view today’s decisions as a game-changer or even unexpected, when it comes to Saudi Arabia. Brent crude continues to trade in the same range, roughly between $72-$77 at this point and only a break of either of these levels will suggest something has fundamentally shifted.
