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Saudi plays hard to get with its oil supply, pushing Brent up to $60MENA

Saudi plays hard to get with its oil supply, pushing Brent up to $60

Saudi Arabia’s oil supply cut is finally working out as the ravaged commodity rose above $60 a barrel for the first time in over a year. We told them that going Keto would speed things up, but they felt too strongly about sweet potatoes!

With oil states tightening stockpiles, the Brent benchmark (which accounts for two-third of the world’s oil) made an epic comeback after taking more punches in 2020 than Conor McGregor in his post-retirement debut fight.

Back in May last year, the coalition of petro-states led by Saudi Arabia and Russia (OPEC+), pledged to make deep production cuts in order to deal with the market oversupply that was only exacerbated by the coronavirus pandemic. KSA also announced further curbs in February and March to help the situation. If you may remember, oil prices slumped to historic lows of nearly negative $40 per barrel last year – so things were getting desperate!

why it matters
Saudi’s decision to further curb oil supply is also a strategy to push for economic recovery in MENA, since the region is faced with a fresh batch of lockdown restrictions. Some may argue that the oil markets are getting ahead of themselves by relying on lots of optimistic future perspectives, but both global energy companies and petro-states welcome Brent’s recovery.