[Asia Economy New York=Special Correspondent Joselgina] International oil prices surged more than 5% as expectations grew that oil-producing countries would implement large-scale production cuts at the regular meeting scheduled for the 5th.
On the 3rd (local time) at the New York Mercantile Exchange (NYMEX), November delivery West Texas Intermediate (WTI) crude oil closed at $83.63 per barrel, up 5.2% ($4.14) from the previous session. This increase was the largest since May 11. The closing price was also the highest since September 20. On the same day, December Brent crude oil on the London ICE Futures Exchange rose 4.4% ($3.72) to trade at $88.86 per barrel.
Oil prices surged as the Organization of the Petroleum Exporting Countries (OPEC) and Russia-led coalition 'OPEC Plus' (OPEC+) is expected to agree on large-scale production cuts at the meeting on the 5th. The Wall Street Journal (WSJ), citing sources, reported that OPEC+ oil-producing countries are considering production cuts exceeding 1 million barrels per day at this meeting.
Since Russia's invasion of Ukraine in February, international oil prices soared but have been declining for four consecutive months since June due to China's COVID-19 lockdowns, recession concerns, and the impact of a strong dollar. This has strengthened expectations that oil-producing countries will prevent further price declines through large-scale production cuts.
Colin Siedzinski, Chief Market Strategist at SIA Wealth Management, conveyed the sentiment, saying, "In a situation where demand is decreasing due to the global economic recession, weekend media reports about OPEC+ possibly implementing production cuts exceeding 1 million barrels to support the market have sparked renewed interest in oil prices."
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