Oil cruises over 2 percent, as Saudi, Russia back supply cut

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Oil cruises over 2 percent, as Saudi, Russia back supply cut

On Monday, the 1st of July 2019, crude oil price futures rose more than 2 percent after Russian President Vladimir Putin had signaled an extension of output cut for about six to nine months on Sunday (June 30th) following a meeting with Saudi Crown Prince Mohammed bin Salman.

For the moment being, OPEC+, an alliance of OPEC members, Russia and other oil exporting nations, had been waiting for an endorsement of Iran, the third-largest oil producer of the world, while other members of OPEC+ had backed an extension of the deal reached back in December 2018 in Vienna, including Iraq.

While this report was being written, July 1st, late midday Asian trading hours, Brent Crude futures had been trading 2.4 percent higher than Friday’s (June 28th) Friday’s closure at $66.31, while US crude futures due to expire on August added 2.4 percent to $60.04 per barrel, its highest level in more than a month.

In fact, analysts were expecting further bull-run ahead of crude oil despite an intransigent US inventory build, as members of OPEC+ have been all-set to meet on Monday and Tuesday (July 1st and 2nd) in order to discuss about supply cuts, while every nation of the pact had agreed to an extension of output cut of 1.2 million barrel per day for another six to nine months.