Oil ends down; Saudi, Russia cuts campaign drowned by factory slump
Investing.com — Right on cue, the Saudis came out to say their million-barrel cut for July will be extended to August and possibly September — maybe even infinitely. The Russians talked up their cuts too. But the announcements coincided with particularly bad global factory activity, sending crude prices lower.
New York-traded West Texas Intermediate, or WTI, settled down 85 cents, or 1.2%, at $69.79 a barrel on Monday.
London-traded Brent crude settled down 76 cents, or 1%, at $74.65 per barrel.
Oil prices slid after weak manufacturing data out of the United States and Germany took precedence over the output cuts announced by the Saudis and the Russians, who are the biggest producers in the 23-nation alliance of oil producers that calls itself OPEC+. Originally a 13-member group, the Saudi-led OPEC, or Organization of the Petroleum Exporting Countries, have co-opted Russia and nine other producers as allies for nearly a decade now.
The Saudis said on Monday they would extend their July output cut of one million barrels per day, or bpd, to August, adding that the reduction could run for another month after that.
Russian Deputy Prime Minister Alexander Novak said Moscow would cut its oil exports by 500,000 barrels per day in August.
The cuts amount to 1.5% of global supply and bring the total pledged by OPEC+ to 5.16M bpd.
OPEC+ already has in place cuts of 3.66M bpd, amounting to 3.6% of global demand, including 2M bpd agreed last year and voluntary cuts of 1.66M bpd agreed in April and extended to December 2024.
“The Saudis might as well say their monthly million-barrel cut will go on infinitely, or at least until a barrel gets to $80 and beyond, because the market knows that’s what they have in mind,” said John
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