The world’s largest oil exporter surprised oil markets last month when it said it would unilaterally slash 1 million barrels a day of crude production in February and March in an effort to raise prices.
But Saudi Arabian Energy Minister Prince Abdulaziz bin Salman said on Wednesday that it was too early to declare victory against the Covid-19 virus and that oil producers must remain "extremely cautious".
"We are in a much better place than we were a year ago, but I must warn, once again, against complacency. The uncertainty is very high, and we have to be extremely cautious," he told an energy industry event.
The stronger price environment has put more attention on OPEC+, which groups OPEC, Russia and allied producers. It meets to set policy on March 4.
OPEC+ oil producers are likely to ease curbs on supply after April given a recovery in prices, OPEC+ sources told Reuters.
"We believe that OPEC+ will likely take a more conservative approach, and ease output more modestly," said ING analyst Warren Patterson.
US oil inventory data from the American Petroleum Institute and the US Energy Information Administration (EIA) will be released on Wednesday and Thursday respectively, a one-day delay for each after this week's US holiday.
Analysts polled by Reuters estimated, on average, that crude stocks fell 2.2 million barrels in the week to February 12.
According to the WSJ report, the planned Saudi move to restore supplies isn’t expected to immediately spark large output increases from other big producers, analysts say, given the kingdom is acknowledged to have carried the biggest burden in reducing production.
However, analysts do expect compliance with output curbs among producers to be increasingly loose as the recovery gains momentum, says the news article.
Saudi’s move to reopen the spigots, while the rest of the group keeps them tight, comes as global demand for oil is expected to recover in the coming months.