The downside pressure on Brent has eased somehow recently. According to POEC sources, Saudi Arabia has cut its crude oil output in July by 200,000 bpd to around 10.29 million bpd. The news came as a surprise as in June, Saudis and Russia pledged to increase output. Meanwhile, according to Baker Hughes , the number of oil rigs in the US declined by two last week to 859. This is the second week of decline in the past three weeks.
On the other hand, Saudi Arabia has resumed oil shipments through the Red Sea shipping lane of Bab al-Mandeb, which deprived the market of an important positive driver. At this stage, the overall sentiment in the crude oil markets looks uncertain, and it is still exposed to downside risks, especially on the back of rising dollar. As such, Brent will need an additional catalyst to stage a more sustainable recovery from recent losses and to get back above $74 in the short term.