Oil Shoots Up As Joe Biden's Saudi Arabia Visit Concludes Without Any Solid Commitment On Output Hike

Oil climbed higher on Monday post a 7% fall last week after U.S. President Joe Biden concluded his landmark visit to Saudi Arabia without any firm commitment to an output hike by the oil-producing country. A weak dollar also aided the rise in oil prices.

Although U.S. energy envoy Amos Hochstein was confident Persian Gulf producers would hike output post the U.S. President’s visit to Saudi Arabia, local ministers maintained that policy decisions would be based on market logic and within the OPEC+ coalition, which includes Russia, Bloomberg reported.

Benzinga's Take: At a time when U.S. inflation came in at over 9%, any drop in oil prices is a win-win for the Biden administration. A rise in output would have further boosted the US’ efforts in taming inflation.

Price Movement: Oil prices had taken a plunge since mid-June led by fears of an imminent recession, which bit into the gains made since the onset of the Russia-Ukraine war. However, a weak dollar and questions over output took prices higher. West Texas Intermediate August futures were trading close to 2.5% higher at over $100 per barrel. Brent Oil futures traded 2.1% higher at $103.32 per barrel.

Key Triggers: OPEC+ — consisting of the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia — is set to meet on August 3 as its two-year supply pact is coming to an end.

Posted In: NewsCommoditiesMarketsJoe BidenOilSaudi Arabia