Brent crude jumps $5/bbl after output cuts; stocks rise

Economy

4-04-2023, 09:14

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INA-Sources

Brent crude oil climbed $5 a barrel on Monday after Saudi Arabia and other OPEC+ producers announced new production cuts, and gains in energy shares helped lift world stock indexes.

The Dow and S&P 500 ended higher, with the S&P energy sector (.SPNY) rising 4.9% for its biggest daily percentage gain since October.

In a surprise move, the OPEC+ group on Sunday announced cuts to production amounting to about 1.16 million barrels per day.

Brent crude rose $5.04, or 6.3%, to settle at $84.93 a barrel, while West Texas Intermediate crude climbed $4.75, or 6.3%, to settle at $80.42.

While the jump in oil prices benefited energy shares, the news added to investor worries about higher costs for businesses and consumers.

Market watchers have been trying to gauge how much longer the Federal Reserve may need to keep raising interest rates to cool inflation and whether the U.S. economy may be headed for recession.

Source: Reuters