The spike of nearly 30% is attributed to tight demand recorded from July through September © Getty Images / Jake Wyman
The world’s oil prices saw a massive quarter-on-quarter surge by nearly 30% in the July-to-September period this year, as supply is restricted due to production cuts agreed by OPEC and its allies, led by Russia.
Brent crude for November delivery dropped nearly 0.1%, at $95.31 per barrel on Friday, but was up 2.2% for the week, 9.7% higher for the month and gained 27.3% for the quarter. Meanwhile, November WTI crude fell a percentage point to settle at $90.79 per barrel, having scored a weekly gain of 0.8%, monthly advance of 8.6%, and ended 28.5% higher for the quarter.
Experts predict that the supply cuts announced by the Organization of the Petroleum Exporting Countries and its allies, together known as OPEC+, are expected to dominate the global oil market for the rest of the year, while prices are projected to remain high. The Joint Ministerial Monitoring Committee panel of the alliance is scheduled for October 4.
Earlier this month, oil-producing heavyweight and de-facto leader of OPEC Saudi Arabia extended its one million barrel per day (bpd) voluntary oil production cut until the end of the year. Meanwhile, its OPEC+ ally and the world’s second-largest crude producer, Russia, has also recently pledged to extend its voluntary cut in oil exports by 300,000 bpd until the end of the year.
Last week, the Russian government introduced a temporary ban on foreign sales of diesel and gasoline in order to stabilize the domestic fuel market.
In addition and of particular concern is the tightening of supplies at Cushing, Oklahoma, the delivery hub for Nymex WTI futures, as stocks there fell by 943,000 barrels in the fourth week of September due to strong refining and export demand.
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