OPEC+ unexpectedly announced production cuts, prices rushed up

Oil prices soared after OPEC+ decided to cut production by 7%. The organization has announced cuts in production quotas by almost 1.5 million barrels a day since May, in addition to the current plan.

Preventive measures are aimed at maintaining the stability of the oil market. Market Analyst Mohammed Ali Yassin says:

“The financial crisis or banking crisis that started in the US in the last two to three weeks and in Europe with Credit Suisse, I think has increased the chances that advanced economies will go into recession faster and earlier than people thought, and perhaps more long term. The second main reason, in my opinion, is that China’s recovery, when everyone suspected it would recover in terms of economic demand, is probably slower than expected.”

Russia has announced that it is extending its decision to voluntarily cut production by 500,000 barrels from March until the end of the year.

Washington called the actions of OPEC + inappropriate, given the uncertainty of the market. The White House is looking for solutions to keep prices low for American consumers. The United States accuses Saudi Arabia of supporting Russian interests, writes euronews.

According to experts, the cost of oil may increase by $10 per barrel.

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