Oil gets a boost from surprise Russia output cut news but falls on weak ISM report

  • Saudi Arabia commits to extending voluntary cut of 1 million bpd
  • Russia to reduce oil exports by 500K bpd
  • US Manufacturing Activity drops the most in 3 years


The bottom is in place for oil after the Saudis and Russians play nice.  The oil market got a boost after the Saudis extended their production cuts and Russia surprised everyone with an export cut announcement of 500,000 bpd.  The Saudi extension should have been expected by everyone, but the Russian export cut news did surprise many energy traders.  Russian oil exports hit pre-war levels in April and Asian demand kept on taking advantage of the Russian discounts.  Russia has hardly been crippled by Western sanctions as they have been able to sell its crude to India, China, and Turkey. 

WTI crude seems poised to make some higher lows here even if a stronger dollar emerges on fears the Fed will be taking rates much higher.  OPEC+ is saying what it needs to keep supplies tight, whether they, the Russians follow on those pledges is another story. The global growth outlook won’t be improving anytime soon given the latest global PMIs, but the US and China outlooks should remain upbeat for the next few months.  US economic resilience will likely remain before we see the slowdown and China will steadily provide more support to their economy. 

Given the shortened trading day, oil price gains might be limited until after the July 4th holiday. WTI crude pared back some gains following a softer ISM manufacturing report.  


Gold prices are steadying following disappointing global PMI data and on expectations the US economic outlook could start to deteriorate more quickly.  Gold should find a home above the $1900 level on  weaker growth expectations following the headlines on student loan debt, tougher times for small and medium size businesses, and potentially a stop and go Fed rate hiking cycle.


Bitcoin hovers above the $30,000 as traders sift through a plethora of fake news and await a meaningful update on the regulatory front.  Over the weekend, false reports circulated that SEC Chair Gensler was going to resign after an internal investigation.  Crypto traders are growing impatient, but it might be a while before we get some meaningful news regarding Grayscale’s lawsuit or further Bitcoin ETF clarity.  Bitcoin appears to be stuck in a range again, trading between $28,000 and $31,500. 

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Ed Moya

Ed Moya

Contributing Author at OANDA
With more than 20 years’ trading experience, Ed Moya was a Senior Market Analyst with OANDA for the Americas from November 2018 to November 2023.

His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies.

Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Prior to OANDA he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news.

Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal.

Ed holds a BA in Economics from Rutgers University.

Ed Moya

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