Oil prices climbed on Monday as members of the Organization of Petroleum Exporting Countries and Russia agreed to cut output by 100,000 barrels a day in October.
the U.S. benchmark, rose 2.6% to $89.58.
Expectations ahead of the meeting was for no change, but Russia came around to supporting the change.
It reversed a 100,000 barrels a day increase last month after U.S. President Joe Biden visited Saudi Arabia.
In a statement, the cartel “noted the adverse impact of volatility and the decline in liquidity on the current oil market and the need to support the market’s stability and its efficient functioning.”
It also said the higher volatility and increased uncertainties require “continuous assessment of market conditions” and said that a meeting could be called at any time to address market developments if necessary.
Francisco Blanch, a BofA analyst, said ahead of the meeting that OPEC+ needs to cope with the major supply and demand pushes in the next few months. A nuclear deal with Iran could push up supply while a a global recession could drive oil demand down, he says.
“On the positive front, the European energy crisis could lead to substantial demand switching into oil while potential supply disruptions from Iraq, Libya, Russia, or others could reduce available oil volumes,” he added.
“Other risks are more nuanced, including a stretched refining system that caps crude intake or widening light-heavy diffs on limited upgrading capacity.”