Oil prices bounced back from a three-day slump on Thursday, closing 1% higher, after reports of a meeting between Saudi Arabia and Russia to discuss measures aimed at stabilizing the market. Brent crude futures rose by $1.37, or 1%, to settle at $74.70 a barrel, while West Texas Intermediate (WTI) crude futures gained 74 cents, or 1.1%, to settle at $68.35 a barrel.
The meeting between Saudi Arabia and Russia was seen as an important development for oil prices, as both countries are major oil producers and members of the OPEC+ group. The two nations reportedly discussed ways to enhance market stability, including the possibility of adjusting output levels in response to changes in demand. The news provided a much-needed boost to oil prices, which had been struggling amid concerns about the spread of the Delta variant of COVID-19 and its potential impact on demand.
The recent volatility in oil prices has been driven by a number of factors, including the ongoing COVID-19 pandemic, geopolitical tensions, and changes in global oil production. In addition, the US Federal Reserve’s recent announcement that it would begin to taper its bond-buying program has also added to uncertainty in the markets.
For the oil industry, the meeting between Saudi Arabia and Russia was seen as a positive sign that major producers are willing to work together to support the market. However, analysts warn that the outlook for oil prices remains uncertain, with many factors still at play.
In the short term, the spread of the Delta variant of COVID-19 remains a major concern, particularly in countries with low vaccination rates. If the virus continues to spread, it could lead to further lockdowns and reduced demand for oil. In addition, tensions between the US and Iran could also impact oil prices, with the potential for further sanctions or military action.
Looking ahead, analysts say that the outlook for oil prices will depend on a range of factors, including global economic growth, changes in supply and demand, and geopolitical developments. In the meantime, investors will be watching closely for any signs of further cooperation between major oil producers, as well as any developments in the ongoing COVID-19 pandemic.