HONG KONG: Oil prices soared almost 6% in Asian trade Monday morning after major producers led by Saudi Arabia announced a surprise cut of more than one million barrels per day (bpd).
The West Texas Intermediate contract jumped 5.74% to $80.01 a barrel, while Brent jumped 5.67% to $84.42.
The move by Saudi Arabia, Iraq, UAE, Kuwait, Algeria and Oman will be in effect from next month until the end of the year, and marks the biggest OPEC oil cut since the cartel slashed two million bpd in October.
The reduction came on top of a Russian decision to extend a cut of 500,000 barrels per day, and in spite of US calls to increase production.
The oil production cuts will fan fresh fears about inflation and put more pressure on central banks to hike interest rates further.
Market "sentiment is likely to take a knock... as higher levels of expected inflation assumes higher [for longer] interest rates", said Matt Simpson at City Index.
"And stocks likely won't appreciate this development, so we could be in for a rocky start to the week."
Investment minister says Pakistan has stabilised its economy quickly
MoUs worth $2 billion likely to be signed between Islamabad and Riyadh during the official visit
The new operator will allow consumers to purchase electricity from suppliers other than distribution companies
Pakistan receives highest-ever quarterly remittances of $8.8bn in 1QFY25, up by 39% YoY
KSE-100 Shares Index hits intraday high of 86,437 points, up 773 points
PTI protests paralysed life in Rawalpindi and Islamabad as authorities sealed off twin cities