Saudi Arabia and other OPEC+ oil producers announced a surprised oil output cuts of around 1.16 million barrels per day, a move that surged oil price to US$86 a barrel.
The kingdom is taking a precautionary measure to supporting the stability of the oil market, according to news reports.
“OPEC is taking pre-emptive steps in case of any possible demand reduction,” Amrita Sen, founder and director of Energy Aspects, told Reuters.
OPEC+ had agreed last October to an output cut of 2 million bpd from November until the end of the year, a move that upset Washington as tighter supply will lead to oil price hike.
Last month, oil prices fell towards $70 a barrel, the lowest in 15 months, on concern that a global banking crisis would hit demand.
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