OPEC's unexpected production cut stimulates a sharp rise in international oil prices

As members of the Organization of the Petroleum Exporting Countries (OPEC) unexpectedly announced a sharp cut in production, international crude oil futures prices rose sharply by more than 6% at the close on the 3rd.

As of the close of the day, the price of light crude oil futures for May delivery on the New York Mercantile Exchange rose $4.75 to close at $80.42 a barrel, an increase of 6.28%. London Brent crude futures for June delivery rose $5.04, or 6.31%, to close at $84.93 a barrel.

OPEC announced on the 3rd that the Joint Technical Committee of OPEC and non-OPEC oil-producing countries noted at the meeting held on the same day that OPEC members announced on the 2nd that they would start a voluntary production reduction plan with an average daily scale of 1.157 million barrels starting in May. It is a precautionary measure to stabilize the oil market. Together with Russia's average daily production reduction of 500,000 barrels until the end of this year, the total scale of voluntary production cuts by major oil-producing countries will reach about 1.66 million barrels per day.

Vivek Dahl, an energy commodity analyst at the Commonwealth Bank of Australia, said that the latest decision of OPEC members shows that the effect of production cuts may be stronger than before.

UBS Group continues to maintain a positive outlook on oil prices, predicting that Brent oil prices will reach $100 a barrel in June this year.