Oil prices up after Saudi announces output cut

Oil prices moved up $1 a barrel on Monday after top global exporter Saudi Arabia pledged to cut production by another 1 million barrels per day from July, counteracting the macroeconomic headwinds that have depressed markets.

Brent crude futures were at $77.15 a barrel, up $1.02, or 1.3%, at 0645 GMT after earlier hitting a session-high of $78.73 a barrel, Reuters said.

US West Texas Intermediate crude climbed $1.02, or 1.4%, to $72.76 a barrel, after touching an intraday high of $75.06 a barrel.

The contracts extended gains of more than 2% on Friday after the Saudi energy ministry said the kingdom’s output would drop to 9 million barrels per day (bpd) in July from around 10 million bpd in May. The cut is Saudi Arabia’s biggest in years.

The group, known as OPEC+, pumps around 40% of the world’s crude and has in place cuts of 3.66 million bpd, amounting to 3.6% of global demand.