Oil prices edged up on Monday as top exporters Saudi Arabia and Russia said they would stick to extra voluntary oil output cuts until the end of the year, keeping supply tight, while investors watched out for tougher U.S. sanctions on Iranian oil. Brent crude futures rose 35 cents, or 0.41%, to $84.89 a barrel by 0400 GMT while U.S.
West Texas Intermediate crude was at $80.92 a barrel, up 41 cents, or 0.51%. Saudi Arabia confirmed it would continue with its additional voluntary cut of 1 million barrels per day (bpd) in December to keep output at around 9 million bpd, a source at the ministry of energy said in a statement.
The Saudi decision was in line with analysts’ expectations.
Russia also announced it would continue its additional voluntary supply cut of 300,000 bpd from its crude oil and petroleum product exports until the end of December.
ING analysts said in a note that the oil market will be in surplus in the first quarter of next year, “which may be enough to convince the Saudis and Russians to continue with cuts.”
Both Brent and WTI contracts notched second weekly falls last week, losing about 6% as the geopolitical risk premium faded.