Oil Prices Surge as OPEC+ Keeps October Output Unchanged
Oil prices surge on Monday as the Organisation of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+) agreed to keep October output unchanged.
Crude prices increased amid renewed tensions between the US and Iran, fueling concerns about further escalation and potential disruptions to oil shipments through the Strait of Hormuz.
International benchmark Brent crude futures for November delivery were trading at $97.50 a barrel, up 1.27% from the previous close of $96.28. US benchmark West Texas Intermediate (WTI) crude futures for October delivery increased 1.11% to $92.50 a barrel from $91.48.
Iran’s Islamic Revolutionary Guard Corps (IRGC) said Sunday that it had destroyed a US military tethered surveillance aerostat in a drone strike near Erbil airport in northern Iraq.
An IRGC statement carried by Iran’s Tasnim news agency said the US military’s Persistent Surveillance Systems-Tethered (PSS-T) aerostat was “completely destroyed” by drones operated by the IRGC Aerospace Force.
It said the aerostat was hit during clashes between Iran and the US in the region on Wednesday. The IRGC also released footage that it claimed showed the moment the surveillance system was hit.
It said the PSS-T differs from conventional balloons because it remains tethered at a fixed location and is used “like a surveillance tower.”
There was no immediate comment from the US on the Iranian claim. A US naval blockade and sanctions targeting Iranian oil exports, together with Tehran’s military activity near the strait, are also keeping supply risks in focus.
Crude oil prices are also being supported by a decision by seven OPEC+ countries not to raise output further in October.
The required production targets for October were set at 10.478 million barrels per day for Saudi Arabia, 9.949 million for Russia, 4.431 million for Iraq, 2.676 million for Kuwait, 1.628 million for Kazakhstan, 1.007 million for Algeria and 0.841 million for Oman.
Their combined production target stands at about 31 million barrels per day. Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria and Oman had agreed to raise their combined output by 188,000 barrels per day in September.
Their latest decision to keep production unchanged in October is supporting prices by limiting expectations of further growth in global supply.
The countries will continue to meet monthly to assess market conditions, with their next meeting scheduled for Oct. 4.
Meanwhile, expectations that Iran and Oman will soon sign an agreement to establish a new shipping corridor through the Strait of Hormuz eased some concerns over regional oil flows and limited price gains.
Iran will declare a new “restricted” maritime zone outside the Strait of Hormuz in the coming days, the country’s top national security official said Sunday, warning that any vessel entering the area would be placed on a sanctions list.
In a televised interview, Mohsen Rezaei, the secretary of Iran’s Supreme National Security Council, said the zone will begin from the US Navy’s blockade line and extend into parts of the Gulf, according to the Iranian state-run Press TV.
“Any vessel entering this new zone will be placed on a sanctions list,” he said.
Rezaei also said Iran and Oman would sign an agreement in the coming days on the new corridor through Hormuz, with its entry and exit points under Iranian control.
He said the Strait of Hormuz was “completely closed and under the control of the armed forces,” dismissing US President Donald Trump’s claim that the strategic waterway remained open as a “big lie.”
Before Iran closed the strait, more than 100 ships carrying over 100 million tons of cargo passed through it daily, Rezaei said. He added that only seven or eight ships carrying essential goods for Iran were now transiting the waterway. Oil Hot Up – Brent Tops $95 as U.S.-Iran Tensions Escalate
