Oil trading volumes are close to their highest level since November last year due to trade optimism and the impact of the shutdown of Saudi Arabia’s world’s largest offshore oil field to tighten supply, Bloomberg reported.
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Futures prices in New York rose another 1% after rising 5.4% last week. Meanwhile, Saudi Arabia is said to be repairing a damaged cable that limits production in the Saffanian oil field.
Crude oil prices have soared by about 24% this year as Saudi Arabia and Russia pledged to expand production cuts, alleviating fears that record U.S. production will lead to a global oversupply of crude oil. This further increases investors’risk preference.
As OPEC and its allies accelerate the implementation of the output reduction agreement reached in December last year, concerns about the intensification of the trade war and the global economic slowdown are fading. In its report, OPEC said that a new round of oil supply cuts had begun strongly and Saudi Arabia had promised to reduce production to above the agreed level.
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