Brent oil has risen above the $90 per barrel mark for the first time on 2023, fueled by the decision of key OPEC+ producers to extend supply cuts, which have led to a tightening of the crude oil market.

As of the latest data, Brent crude is currently trading at $90.34 per barrel, marking a 1.5% increase for the day. Simultaneously, West Texas Intermediate crude (WTI) is trading at $87.24 per barrel, reflecting a 2% day-on-day increase.

Saudi Arabia has extended its unilateral production cut for an additional three months, aiming to provide support to the delicate global market conditions, according to Bloomberg reports. The recent upward momentum in crude oil prices can be attributed primarily to the production cuts implemented by Saudi Arabia and Russia, which have effectively reduced global oil inventories.

Commodities Analysts had anticipated that Saudi Arabia and Russia would prolong their voluntary production cuts through October, but the unexpected three-month extension surprised the market. Both countries have indicated that they will assess the supply cuts on a monthly basis, with the possibility of adjustments based on prevailing market conditions.

Notably, both Brent and WTI futures have surged by more than 20 percent since the close of June.

UBS is now projecting that Brent crude will reach $95 per barrel by the end of the year.

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