"IEA-OPEC Production Cuts: Oil Prices and Volatility Set to Soar"

The International Energy Agency (IEA) has warned that oil prices are expected to surge in volatility due to a significant supply shortfall caused by the Saudi-led cuts to OPEC+ oil supply in the fourth quarter of 2023. Despite higher crude oil production from non-OPEC+ countries offsetting some of the cuts this year, the loss of OPEC+ production, particularly from Saudi Arabia, is projected to create a supply shortfall. The extension of production and export cuts by Saudi Arabia and Russia until the end of 2023 has already pushed Brent Crude prices above $90 per barrel, leading to increased volatility. If the cuts are unwound in early 2024, the market could shift to a surplus, but oil stocks would remain at low levels, posing a risk of further volatility.