(Bloomberg) -- Saudi Arabia is expected to extend a 1 million-barrel oil supply cut into September as it seeks to foster a tentative recovery in crude prices.

Riyadh introduced the additional cutback this month — on top of output curbs it’s already making with fellow OPEC+ producers — to shore up oil markets against a fragile economic backdrop.

The measure already has been extended into August, and 15 of 22 traders, analysts and refiners surveyed by Bloomberg predict it will continue into September. The two previous announcements about the kingdom’s voluntary production cuts came via state media in the first week of the month.

Oil prices have climbed about 12% in the past month to about $83 a barrel in London as recovering global fuel consumption and output restraint by the Organization of Petroleum Exporting Countries engineer a long-awaited tightening of world markets. 

That’s giving consumers in the US and elsewhere some respite from last year’s unprecedented wave of inflation and may give the Saudis scope to relax their supply curbs. But prices may still be too low for the kingdom, which needs $100-a-barrel crude to finance ambitious spending plans, according to Bloomberg Economics.  

“The kingdom will want to see a protracted rise toward $90 a barrel and possibly improvement in Chinese economic data to start considering putting the 1 million barrels per day back into the market,” said Tamas Varga, an analyst at brokers PVM Oil Associates Ltd. in London.

The supply shortfall in global oil markets is expected by many forecasters to deepen markedly in months ahead. The International Energy Agency in Paris, which advises major economies, sees a shortage of about 1.7 million barrels a day during the second half of the year.

Six participants in the survey predicted this will encourage the Saudis to taper off their extra cut by restoring about 250,000 barrels to 500,000 barrels a day of halted production in September.

“There’s ample evidence for Saudi Arabia to start unwinding the cuts in September,” said James Davis, director of short-term global oil services at consultants FGE. “The market is screaming out for these barrels, and refiners are scrambling to get hold of them.”

Cargoes of crude grades similar to those sold by the Saudis — which are often heavier and more sulfurous than other varieties — have been commanding a premium, traders say. 

If the Saudis do phase out the curbs in September, it wouldn’t be the first time they bucked market expectations. Saudi Energy Minister Prince Abdulaziz bin Salman has built a reputation for springing surprises aimed at wrong-footing oil speculators — though more typically for bullish moves.

But financial pressures may prove too powerful for the kingdom to relax its grip. 

The ambitious economic and social transformations planned by Crown Prince Mohammad bin Salman require much higher prices, according to Bloomberg Economics. 

On Monday, the kingdom suffered the steepest growth downgrade among major economies from the International Monetary Fund, which projects that Saudi gross domestic product will expand by just 1.9% this year. 

Keeping a tight rein on supplies may also help Riyadh encourage discipline among others in the OPEC+ alliance.

Russia — a key member of the group — finally started implementing its pledged share of the group’s supply curbs after prevaricating for months. Until recently, Moscow had focused on maximizing oil sales to fund its invasion of Ukraine, but tanker tracking shows shipments have plunged in recent weeks to a six-month low of 3.1 million barrels a day.

Key nations from the OPEC+ alliance will hold an online meeting Aug. 4 to assess oil market conditions. The full 23-nation group is due to meet in late November.

--With assistance from Fiona MacDonald and Nayla Razzouk.

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