Saudi Arabia pledged an additional production cut in July to stabilize the oil market, ceding ground to two of its key allies — Russia and the United Arab Emirates — which made no commitment to curb further.

Here’s what leading analysts have to say about the kingdom’s move to go it alone with a 1 million barrel-a-day reduction:

Morgan Stanley

The cut may support prices in the short term, but the broad market dynamics for the rest of 2023 and into 2024 remain practically unchanged, analysts including Martijn Rats and Charlotte Firkins wrote in a note. It’s the third OPEC cut in nine months and likely to be the last this year, provided there are no major changes in the supply and demand outlook, they added.

Goldman Sachs Group Inc.

The OPEC+ meeting was moderately bullish and offset some bearish downside risk to the bank’s December forecast of $95 a barrel, said analysts including Daan Struyven and Callum Bruce. The Saudi energy minister’s “whatever is necessary” comment signals a commitment to continue to lean against the shorts and leverage its unusually high pricing power, they said.

Vanda Insights

“The Saudi energy minister is in a difficult situation, having repeated that warning to short sellers,” Vandana Hari, the founder of consultancy Vanda Insights in Singapore, said in a Bloomberg television interview. Speculators are going to follow market cues, and if the global economy shows signs of weakness, they “will be back in no time,” she added.

Commonwealth Bank of Australia

Saudi Arabia will likely extend July’s production cuts if Brent remains stuck between $70 and $75 a barrel, said Vivek Dhar, director of mining and energy commodities research at Commonwealth Bank of Australia. The kingdom could even deepen the curbs if prices drop below $70 a barrel, he added.

RBC Capital Markets

While some will focus on Saudi Arabia not acting in concert with the rest of OPEC+, the fact that the kingdom is willing to shoulder the curbs alone adds to the credibility of the cut and signals real barrels coming off the market, analysts Helima Croft and Christopher Louney wrote in a note. Saudi Arabia has a track record of delivering on material cuts, they said.

ANZ Group Holdings Ltd.

“The move by Saudi Arabia is likely to come as a surprise, considering the most recent change to quotas had only been in effect for a month,” analysts Brian Martin and Daniel Hynes wrote in a note. “The oil market now looks like it will be even tighter in the second half of the year.”