Higher In Asia As OPEC Production Cut Speculation Simmers

WTI and Brent are $1.10 firmer apiece, building on a move off of their respective post-Powell lows observed on Friday.

• To recap Friday’s price action, both benchmarks reversed losses observed after Fed Chair Powell warned of “pain to households and businesses” ahead, ultimately closing ~$0.50 higher apiece amidst signs that OPEC may be considering output cuts.
• To elaborate on the latter, speculation over the prospect of output quota cuts continues to simmer as RTRS source reports have pointed to UAE support for such a measure, adding to recent, similar comments from the Saudi Energy Minister and the current OPEC President.
• A note that RTRS sources had suggested last week that OPEC production cuts would likely “coincide” with the return of Iranian crude to global supplies.
• On that topic, Iran will take until “at least” Sep 2 to respond to the latest U.S. reply re: a U.S.-Iran nuclear deal. Kpler and Vortexa have pointed to >70mn bbls of Iranian crude stored on vessels in various locations, ready for delivery upon a successful agreement.
• Elsewhere, Libya’s capital of Tripoli witnessed a surge in violence over the weekend (a result of ongoing political unrest as factions struggle for control of the capital), raising worry from some quarters re: the stability of recently-restored Libyan crude production (>1.2mn bpd).