Oil prices surged after Saudi Arabia extended production cuts as expected and Russia followed suit by extending export restrictions

　　Saudi Arabia (KSA) announced that its voluntary production cuts will be extended for another month, and said that it may further extend or even increase the size of the cuts. According to a statement on the Saudi state news agency, the leaders of the Organization of the Petroleum Exporting Countries (OPEC) extended production cuts of 1 million barrels per day until September. That would keep production at around 9 million barrels per day, the lowest level in several years.

　　Later, its ally Russia (RUS) also said it would extend export restrictions. Russian Deputy Prime Minister Alexander Novak said in a statement that Russia would extend its crude oil export restrictions until September, reducing the size of the cut to 300,000 BPD from 500,000 BPD in August.

　　Brent oil prices surged 2.1 per cent to $85 after the announcement.

　　Saudi Arabia and Russia will chair a meeting of the OPEC+ Ministerial Monitoring Committee (JMMC) on Friday, which is likely to be a formality as major moves expected by the market have already been announced in advance.