Oil prices approached their highest level in three months, Monday, and are heading for their largest monthly gain in more than a year, amid expectations that Saudi Arabia will extend the voluntary production cut, to September, and global supply scarcity, according to Reuters.
By 0005 GMT, Brent crude futures fell 9 cents to $84.90 a barrel. US West Texas Intermediate crude fell 17 cents to $80.41 a barrel.
The September Brent crude contract expires later on Monday. The October contract was the most active, recording $84.23 a barrel, down 18 cents.
Brent and West Texas Intermediate settled, on Friday, at their highest levels since April, continuing to achieve gains for the fifth week in a row, after prices received support due to the scarcity of global oil supplies and expectations of an end to raising US interest rates. And the two benchmarks are on their way to ending July with the largest monthly gain since January 2022.
Analysts said that Saudi Arabia is expected to extend the voluntary reduction of its oil production by one million barrels per day for another month, to include September.
Goldman Sachs analysts said in a note, Monday, “Oil prices have risen 18 percent since mid-June, as the record rise in demand and the reduction in Saudi supply led to the return of deficits in the markets, amid the market abandoning the state of pessimism about growth.”
“We still expect the additional Saudi cut of 1 million barrels per day to continue until September and to halve from October,” the analysts added.
The bank maintained its forecast for Brent crude at $86 a barrel for December, and expects prices to rise to $93 in the second quarter of 2024.
2023-07-31 02:43:04
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