Oil prices are now expected to reach triple digits before year’s end as global supply tightens from missing output from Saudi Arabia and Russia.
The international benchmark Brent crude rose to its year high at $94.10 a barrel on Friday, while the West Texas Intermediate rose to its year high as well at $90.61 a barrel.
Surge in oil prices came after Saudi Arabia and Russia announced to extend their voluntary production cuts to the end of this year. Earlier this month, OPEC’s largest oil producer Saudi Arabia announced that it would extend the decision for an output cut by one million barrels per day to the end of this year. Meanwhile, Russia also announced to extend the 300,000 a barrel per day cut until the end of December as well.
The analyst from the Bank of America noted that oil prices could soon spike beyond past $100 a barrel before 2024 should top oil producers in OPEC continue to cut supply off the global market.
