Oil traders are daring to defy market kingpin Saudi Arabia

The immediate price gain from the latest curbs that Saudi Arabia announced on Sunday lasted only for one day

Oil traders are starting to ignore the most important person in the market. It could prove a risky gambit.

A week ago, Saudi Arabian energy minister Prince Abdulaziz bin Salman, pledged to unilaterally cut the country's July oil production to the lowest in over a decade excluding covid-19 era curtailments. He described the move as a "lollipop".

While there have been bigger output cuts in recent months, its symbolism was important, and Prince Abdulaziz left open the possibility of extending the curb. It also came on the back of a litany of comments that suggest the prince wants to hurt those who speculate on lower prices.

And yet traders are becoming less responsive. The immediate price gain from the curbs he announced on Sunday lasted a day. By Friday at 5 pm in London, Brent futures were around $76 a barrel-almost exactly where they were a week earlier. A previous output cut in April took less than a month to wear off on prices.

Speaking on Sunday, the prince said the Opec+ agreement was about being proactive and precautionary. "I think the physical market is telling us something and the futures market is telling us something else," he said at the Arab, China Business Conference in Riyadh. "To understand Opec+ today, it's all about being proactive, pre-emptive and precautionary."