The International Energy Agency (IEA) warned on Monday that the surprising production output cut by the OPEC+ countries will only further increase crude prices amid "strong inflationary pressures."
The agency had previously predicted that the world's oil markets would start to tighten in the second half of 2023, with the possibility of a sizable supply shortfall. "The new OPEC+ cuts risk exacerbating those strains," the IEA said in the statement, warning that the decision will mostly affect "vulnerable" customers around the world.
The United Arab Emirates, Kuwait, Oman, Iraq, Kazakhstan, and Algeria joined Saudi Arabia in the decision to lower oil production.