Oil prices rose on Tuesday morning in the wake of further production cut announcements by Russia and Saudi Arabia.
Russia announced a 500,000 barrel per day cut on Monday, while Saudi Arabia confirmed a 1mln daily reduction would continue through August.
West Texas Intermediate rose marginally by 0.2% to US$70.27 per barrel on Tuesday morning following the news, while Brent climbed 0.6% to US$75.28, as per Trading Economics.
Further cuts come amid efforts to “ensure that the oil market remains balanced”, Russian deputy prime minister Alexander Novak said on Monday.
OPEC+, which is responsible for around 40% of the world’s oil production, has repeatedly opted to cut output this year, as supply concerns grow on US economic woes.
“[These] worries continue to linger about the strength of demand in the global economy,” Hargreaves Lansdown analyst Susannah Streeter commented.
Falling US manufacturing output marks a particular concern, she added, with S&P Global reporting the second successive monthly decline in the health of the sector on Monday.
“Leading the darkening picture was a severe drop in demand for goods, with new orders slumping at a rate among the steepest since the global financial crisis,” the analytics firm said.
“Markets are weighing up the softer demand outlook against the potential for tighter supplies,” interactive investor analyst Victoria Scholar added, with prices having shown volatility over the past day.