The cuts come on top of expected further demand growth, with oil demand set to rise by 2.2 million barrels a day in 2023, averaging 101.8 million barrels a day, according to the IEA. 'The Saudi-Russian alliance is proving a formidable challenge for oil markets,' the IEA said, noting that the cuts to supply from both nations of about 1.3 million barrels a day led to a spike in prices, with Brent Crude, the international benchmark for crude oil, rising above $90 a barrel and prices pushing to a 10-month high. The unwinding of the cuts in 2024 should bring the market back to surplus but a lack of oil inventories could mean high volatility in the market, the Paris-based agency added. However, with Saudi production and also Russian exports being cut until the end of the year, the market is now likely to see a significant shortfall of about 1.1 million barrels a day in the fourth quarter, something which is likely to support prices, the IEA said Wednesday. and Brazil, with non-OPEC supply up 1.9 million barrels a day. In its monthly report, the IEA said that cuts from Saudi Arabia and other members of the Organization of the Petroleum Exporting Countries have led to 2.5 million barrels a day being removed from the market since January, though this has mostly been mitigated by record supply coming from the U.S.
