Saudi Arabia: Oil prices increase in September–October
October 1, 2021
On 1 October, the OPEC oil basket traded at USD 77.7 per barrel, up 9.1% from the prior month. Moreover, the price was 54.7% higher on a year-to-date basis and was 94.6% higher than on the same day last year.
The recent rise in global crude oil prices was predominately driven by a faster-than-expected recovery in oil demand amid supply disruptions. Crude oil demand took a hit due to the spread of the Delta variant in recent months, but the ongoing rollout of vaccines and easing restrictions in September supported a revival in crude oil demand, consequently pushing prices higher. On the supply side, supply disruptions in the U.S. due to Hurricane Ida back in August continues to weigh on output, further supporting price pressures in recent weeks.
In terms of OPEC production, combined crude oil output among members increased from July’s 26.6 million barrels per day (mbpd) to 26.8 mbpd in August—the latest month for which data is available. This mostly reflected higher output in Iraq and the UAE. Moreover, Saudi Arabia output also increased from 9.4 mbpd in July to 9.5 mbpd in August.
Author: Steven Burke, Economist