OPEC+ cuts global oil supplies, reversing September increase
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The Organization of the Petroleum Exporting Countries (OPEC) and its allies, also known as OPEC+, plan to cut global oil supplies by 100,000 barrels per day next month, which an industry expert claims is more of a "political statement."
The October cut essentially reversed the group's September increase by the same amount.
Oil producers, such as Saudi Arabia, have resisted calls from President Biden to pump more oil to lower gasoline prices and the burden on consumers. In fact, Monday's move also comes after comments from Saudi Arabia’s energy minister that the group could reduce output at any time.
"With OPEC+ production already running nearly 3 million barrels per day less than their agreed to quota, the announcement is more of a political statement," Lipow Oil Associates President Andy Lipow told FOX Business. "Saudi Arabia wants to talk up prices and the burden of any production cut will rest predominantly with them and to a lesser extent with the United Arab Emirates and Kuwait."
OIL GETS A BOOST: BIDEN CELEBRATES AS OPEC+ AGREES TO RAMP UP PRODUCTION
Although oil prices are rising Monday, Lipow said it is mainly due to Russian energy giant Gazprom's shutdown of Nordstream 1 natural gas supplies.