Surprise cuts in oil production by several major exporters have led to a surge in oil prices, with Brent crude trading near $85 a barrel after rising by nearly 6%.
The move by Saudi Arabia, Iraq, and other Gulf states to reduce output by over one million barrels per day, along with Russia’s decision to extend its own cut of half a million barrels per day until the end of the year, has led to concerns that higher oil prices could make it more difficult to bring down the cost of living.
However, the RAC motoring group has said that petrol prices are not expected to increase unless the higher oil price is sustained over several days.
The US National Security Council has called for producers to increase output in order to push energy prices lower, while economists have warned that the oil price surge could make it harder to combat inflation.
