Brent holds above the $90/bbl mark

The front-month ICE Brent contract has moved up $0.91/bbl on the day, to trade at $91.16/bbl at 09.00 GMT.

PHOTO: Getty Images

Upward pressure:

Brent crude futures remain well-supported amid tight supply in the global market. The front-month ICE Brent contract rose above the $90/bbl mark earlier this month, after Saudi Arabia and Russia announced extended supply cuts through the end of this year.

The total supply cut pledged by Saudi Arabia and Russia until December 2023 sums up to about 1.3 million b/d.

The supply cuts have pushed oil prices higher, said the Price Futures Group’s senior market analyst Phil Flynn. Moreover, "we should see more crude draws this week [in the US]," he said.

Downward pressure:

Brent futures face some downward pressure amid fears of more interest rate hikes this year by the US Federal Reserve (Fed) and other central banks.

Analysts have said that Brent’s gains will be capped if Fed officials decide to have another round of interest rate hike when they meet in November.

Additionally, the European Central Bank (ECB) is expected to decide on interest rate hike later this week.

By Aparupa Mazumder

Please get in touch with comments or additional info to news@engine.online