Crude oil benchmarks jumped over 4% after OPEC+ announced an unexpected three-month extension of current production cuts. Brent crude settled at $85.60 per barrel, while WTI closed at $81.20.
The decision, made during a virtual ministers’ meeting, caught many analysts off guard. Saudi Energy Minister Fahd Al-Sabah stated that “the group remains committed to supporting market stability,” citing lingering demand concerns in China and Europe.
IGS Investment’s Commodities Analyst, Raj Patel, observed:
“By extending cuts, OPEC+ aims to prevent a price collapse amid slower global growth. We expect the rally to continue into July, especially if refinery maintenance season reduces available supply further.”
Natural gas and coal prices also edged higher, reflecting broader bullish sentiment across energy commodities. Conversely, precious metals were mixed: gold dipped 0.5% on profit-taking, while silver rose 1.1% on renewed industrial demand.
Clients of IGS Investment with exposure to energy equities saw the strongest returns this week. The firm’s research team recommends monitoring U.S. rig counts and shipping data for signs of shifting supply dynamics, and advises using collars to manage downside risk on long positions.