Search for Oil Balance: Signals from OPEC+ and Saudi Arabia

Pursuit of Oil Balance

Oil prices stabilized after a two-day rise following an agreement by OPEC+ to increase its limited production quota. Investors continue to evaluate Saudi Arabia's lower-than-expected price signals.

What is the Price Situation?

Brent crude is trading around $66 per barrel, while U.S. crude oil (WTI) is below $62. Although OPEC and its allies, including Russia, agreed over the weekend to a daily production increase of 137,000 barrels, the de facto leader Saudi Arabia took a cautious stance by deciding to keep the price of its main quality oil sold to Asia stable. This situation has surprised investors expecting an increase.

Losses in August and September

Crude oil experienced consecutive losses in August and September. The main reason for these losses is emerging concerns about an impending supply surplus. OPEC+ has been increasing production for months in an effort to regain market share; however, American rival producers are also continuing to ramp up their output. Additionally, investors are closely monitoring Ukraine's attacks on Russian energy infrastructure.