Oil prices recovered on Monday after OPEC+ announced a smaller-than-expected output increase and market sentiment shifted on renewed concerns over possible sanctions on Russian crude.
Brent crude oil, against which Nigerian crude oil is priced, rose $1.28, or 1.95% to $66.78 per barrel by 11:31 a.m. in Nigeria, while U.S. West Texas Intermediate (WTI) gained $1.20, or 1.94%, to $63.07.
Both benchmarks had fallen more than 2% on Friday following weaker-than-expected U.S. employment data and recorded losses of over 3% last week.
OPEC+ Decision
The Organization of the Petroleum Exporting Countries and its allies (OPEC+) agreed on Sunday to raise production by 137,000 barrels per day from October, significantly lower than the 555,000 bpd hikes in August and September and 411,000 bpd in July and June.
Analysts noted that the market had anticipated a larger increase, and the decision triggered a reversal in sentiment.
Ole Hansen, Head of Commodity Strategy at Saxo Bank, stated that the market had “run ahead of itself” regarding expectations. He added that the rebound reflected a “classic sell-the-rumour, buy-the-fact reaction.”
Supply and Geopolitical Risks
While the announced production hike is expected to have limited impact, as some members have already been overproducing, traders are increasingly focused on the risk of tighter supply stemming from potential new U.S. sanctions on Russia.
U.S. President Donald Trump signaled readiness to move into a second phase of sanctions targeting Russian oil buyers, raising the possibility of disruptions to crude flows.
Energy trader Gunvor’s Global Head of Research and Analysis, Frederic Lasserre, cautioned that further sanctions could intensify market volatility.
The sanctions discussion comes after Russia launched its largest air assault of the Ukraine conflict over the weekend, which killed at least four people and set the central government building in Kyiv on fire.
Goldman Sachs, in a note issued over the weekend, maintained its 2025 Brent and WTI forecasts and projected average prices of $56/$52 per barrel in 2026.
The bank cited an expected increase in supply from the Americas, partially offsetting lower Russian supply projections and stronger global demand.
With OPEC+ adopting a cautious stance on output increases and geopolitical risks surrounding Russian crude flows intensifying, analysts expect oil markets to remain volatile in the near term.