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Saudi Arabia and several other producers, including the UAE and Iraq, unexpectedly announced oil output cuts totaling more than one million barrels per day starting in May. The move was made outside the usual negotiated OPEC+ meeting process and drove oil prices and expected gasoline prices higher.
A surprise supply reduction of this size tightens crude and fuel markets, raising diesel and transport costs for feed buyers. Higher energy prices can also lift biofuel-linked demand for vegetable oils.
npr.orgCamila DomonoskeApr 3, 2023After 438 past bullish policy events, WTI moved a median +0.9% over 5 sessions (61% higher; middle half -2.2% to +4.6%), and +2.0% over 20.
After 442 past bullish policy events, BRENT moved a median +1.4% over 5 sessions (60% higher; middle half -2.0% to +4.9%), and +2.1% over 20.
After 90 past bullish policy events, DIESEL moved a median +1.4% over 5 sessions (66% higher; middle half -1.9% to +4.1%), and +0.1% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Explains the unexpected cut, made outside the normal OPEC+ process, which raised supply-risk sentiment and pushed prices higher.
