WionDrive News Desk 
Oil prices have surged over 2% on Monday, with Brent futures climbing to $74.81 per barrel and West Texas Intermediate (WTI) crude reaching $71.30 per barrel. The rally was driven by a decision from OPEC+ to delay a planned increase in oil production, as well as growing uncertainty surrounding the upcoming US presidential election.
On Sunday, OPEC+, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies such as Russia, announced that it would extend its current output cut of 2.2 million barrels per day (bpd) for another month in December. The group had originally been scheduled to increase monthly output by 180,000 bpd from December.
According to UBS analyst Giovanni Staunovo, OPEC+ decided to hold off on the production increase “considering ongoing economic growth concerns” and a desire to have “more clarity on the economic impact of the interest rate cuts in the US and the fiscal and monetary policy easing in China.” The group also wants to assess the potential impact of the next US president on oil policy.
The decision to delay the output hike comes amid growing volatility in energy markets, as highlighted by Eni CEO Claudio Descalzi. He noted that OPEC+ oil supply cuts and recent efforts to unwind them have increased market volatility and hampered investment in new production.
Analysts expect high levels of oil price volatility this week, with investors closely watching for Iran’s response to recent Israeli attacks and the outcome of the US presidential election. Senior advisors to President Trump have expressed strong support for striking Iranian nuclear facilities and reinstating maximum pressure sanctions, while a Harris administration would likely focus on ending the conflict more quickly.
The US election is seen as a key factor influencing oil prices, with the race between Democratic candidate Kamala Harris and Republican Donald Trump remaining too close to call. The winner may not be known for days after voting ends on Tuesday.
Investor focus will also be on the US Federal Reserve’s policy decision on Thursday, with economists expecting a 25 basis point interest rate cut. Additionally, the Standing Committee of the National People’s Congress in China is set to meet from Monday to Friday, and is expected to approve additional stimulus measures to boost the country’s slowing economy.
The combination of the OPEC+ decision, the US election, and the potential policy actions from the US and China are all likely to shape the trajectory of oil prices in the coming weeks and months. As the market navigates these complex dynamics, volatility is expected to remain elevated, underscoring the continued uncertainties faced by the global energy industry.
