Oil Prices fall by one percent following Saudi Arabia cuts

Oil prices fell by more than 1% on Monday on sharp price cuts by top exporter Saudi Arabia and a rise in OPEC output, offsetting worries about escalating geopolitical tension in the Middle East.

Brent crude slipped 1.09%, or 86 cents, to $77.90 a barrel by 0344 GMT, while U.S. West Texas Intermediate crude futures shed 1.15%, or 85 cents, to $72.96 a barrel.

Rising supply and competition with rival producers prompted Saudi Arabia on Sunday to cut the February official selling price (OSP) of its flagship Arab Light crude to Asia to the lowest level in 27 months.

Both contracts climbed more than 2% in the first week of 2024 after investors returned from holidays to focus on geopolitical risk in the Middle East following attacks by Yemeni Houthis on ships in the Red Sea.

Reuters/Hauwa Abu