U.S. oil prices snapped back with modest gains Monday, building on the more than 9% jump for the month of June, as major producers said they’ll hold back in pushing more oil onto the global market.
August West Texas Intermediate crude CLQ19, +2.65% was up $1.53, or 2.6%, to $60 a barrel on the New York Mercantile Exchange.
International benchmark September Brent BRNU19, +2.49% was up $1.65, or 2.6%, at $66.43 a barrel. Prices on a front-month contract basis were up 3.2% for June, according to Dow Jones Market Data.
Russia and Saudi Arabia have agreed to extend the OPEC oil production-reduction deal by another six to nine months, Russian President Vladimir Putin said at the G-20 leaders summit in Japan on Saturday. Saudi Energy Minister Khalid al-Falih backed Putin’s comments on his own remarks offered Sunday.
The OPEC+ group — the Organization of the Petroleum Exporting Countries, plus Russia and other producers — meet July 1-2 to renegotiate the pact which expired June 30. In 2016, Saudi Arabia and Russia agreed to try to jointly manage global oil output to support prices in what became known as the OPEC+ coalition and the current deal called for production cuts of 1.2 million barrels a day.
Saudi Arabia, the world’s largest crude exporter, doesn’t see a need for deeper cuts and markets will likely balance in the next six to nine months, Falih said. “Demand is softening a little bit but I think it’s still healthy,” he said.
The meetings also come as tensions between the U.S. and Iran have grown after Iran shot down a U.S. surveillance drone over the Strait of Hormuz earlier this month, a situation that some analysts suggest risks the flow and transport of oil from the region.
The energy market got a boost on the