As of Monday morning, Brent Crude was priced at $77.74 per barrel. Differing opinions exist regarding the potential trajectory of oil prices post the OPEC+ meeting.
The markets are looking to see whether Saudi will extend its 1 million barrel a day output to the end of 2023 and the impact this may have on prices as we move into 2024.
Following seven months of double digit inflation, the UK has reduced the CPI to 4.6% in October, meaning further interest rate hikes are now less likely.
Iran has warned that an escalation of tensions between Israel and Hamas is inevitable. This week may witness the unfolding of the Middle East conflict, with many anticipating an intensification of Israeli operations in Gaza City. Heightened activities from Lebanon and Iran could potentially trigger a surge in oil prices, offering limited security.
Top oil exporters Saudi Arabia and Russia reaffirmed their commitment to additional voluntary oil supply cuts until the end of the year, with Saudi Arabia cutting 1 million barrels per day (bpd) and Russia cutting 500,000 bpd.
Last week saw major whipsaws in the price of Oil as investors weighed a deteriorating economic climate with risk premium from the Israel-Hamas conflict.
As markets opened on Monday morning, Brent Crude was trading at $91.81 per barrel. This is in stark contrast to earlier forecasts, which had predicted a Q4 2023 price of $85 per barrel, as suggested by banks like JP Morgan earlier this year.
Crude oil prices surged on Monday, opening with a significant gap and closing the session 4.35% higher, marking the most substantial single-day gain since early April.
The oil and diesel markets saw significant falls last week amid fears of recessions in the Western economies and further interest rate hikes.
Brent crude, a benchmark for fuel prices, breached $96 a barrel on Friday amid predictions of shorter supplies.