Saudi Arabia and Russia hold steady on oil supply cuts

The news: Saudi Arabia and Russia have reaffirmed planned oil supply restrictions of more than one million barrels per day until the end of the year, and hinted at further cuts, pushing crude prices slightly higher.

The numbers: Riyadh has cut daily crude production by one million barrels per day while Moscow has curbed its exports by 300,000 barrels per day, Bloomberg reports. Oil futures edged higher in early trading on Monday, but have since eased to USD85.03 per barrel for Brent crude, and USD81.59 per barrel for West Texas crude. Saudi said it would review production volumes in November and would consider deepening cuts, extending current cuts or extending production.

The context: Oil prices have been volatile in recent weeks amid concerns that Israel-Hamas war may trigger broader regional conflict. According to Bloomberg Economics, Saudi Arabia could require a USD100 per barrel oil price to fund expensive infrastructure and sports spending, while Russia needs petroleum revenues to fund its war in Ukraine.