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Oil Prices Soar on Output Cuts

Oil prices surged on Monday after Saudi Aramco said that it sees a rebound in oil demand in Asia as more economies gradually open up after the easing of COVID-19 lockdowns and despite a resurgence of virus cases in some places.

Also, Iraq said Friday that it would reduce its oil output by a further 400,000 barrels per day in August and September to compensate for its overproduction in the past three months.

Sentiment was also supported by signs of a gradual economic recovery in China after data showed annual inflation rose to 2.7% in July, the highest in three months, while factory gate prices fell at a slower rate.

Investors also cheered news that House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin were open to restarting talks on a further stimulus in the US after weeks of failed negotiations.

At around 03:45 AM GMT, WTI crude jumped 1.3% to $41.77 a barrel, while Brent Crude climbed almost 1% to $44.84 a barrel.

Credit: Trading Economics

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