Oil prices extended their gains to Monday, rising more than 2%, as OPEC+ agreed to keep their production cuts in place for another month, while the market also braced for the U.S. presidential election and a key meeting in China.

Brent futures (CO1:COM) rose by +2.63% to $75.02 a barrel, U.S. West Texas Intermediate crude (CL1:COM) advanced +2.92% to $71.52.

OPEC+, which includes the Organization of the Petroleum Exporting Countries plus Russia and other allies, on Sunday said it would extend its output cut of 2.2 million barrels per day (bpd) for another month in December, with an increase already delayed from October because of falling prices and weak demand.

The previous statements of OPEC+ made clear that it would adapt its plans based on market conditions.

"Considering ongoing economic growth concerns, we believe the group wants more clarity on the economic impact of the interest rate cuts in the US and the fiscal and monetary policy easing in China," UBS analysts said in a note.

"OPEC+ still indicates a desire to return barrels to the market if market conditions allow it. The planned increase in production is also a signal to U.S. shale producers, as this should keep U.S. shale companies prudent in their 2025 investment and production decisions."

UBS, therefore, retains its "moderately constructive outlook" and continues to recommend risk-seeking investors to sell crude oil’s downside price risks.

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Meanwhile, the ongoing cycle of retaliatory strikes between Israel and Iran has kept investors on edge amid increased risk of oil facilities becoming targets. Iran escalated its rhetoric against Israel, with its supreme leader Ayatollah Ali Khamenei warning of a “crushing response” in a speech on Saturday.

The broader market has also entered the all-important week, wherein the focus will be on the U.S. Fed meeting outcome. Traders expect the Fed to go ahead and cut rates on Thursday, with futures implying a 98% chance of 25 basis points.

Turning to metals, gold prices held steady after a weekly drop, rising +0.20% to $2,741.69 an ounce by 5 am ET, while silver (XAGUSD:CUR) rose +1.22% to $32.83, rebounding slightly from a two-week low, driven by a weaker U.S. dollar index (DXY).

Gold has recently hit a series of record highs driven by safe-haven demand from Middle East tensions and prospects of more interest rate cuts, along with uncertainties surrounding the Nov. 5 election.

Elsewhere, hopes for further stimulus measures from China contributed to positive sentiment as the National People’s Congress commenced its five-day meeting.

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