The Saudi-led oil cartel expects demand to grow by 2.3 million barrels per day to an average of 101.87 million barrels per day this year.

Oil prices have declined since October due to slower Chinese and global growth and higher interest rates, prompting market speculation the group could cut output again.

Beyond the economic gloom, the big unknown in the oil equation currently is Russian oil, as Western nations seek to decouple themselves from Moscow's energy supplies as fast as possible.

The new British prime minister met separately with Crown Prince Mohammed bin Salman, the oil-rich kingdom's effective ruler, as they gathered for the Group of 20 summit in Bali.

Oil demand in 2022 will increase by 2.55 million barrels per day, or 2.6%, the Organization of the Petroleum Exporting Countries says in a monthly report, down 100,000 bpd from the previous forecast.

The International Energy Agency says demand for all fossil fuels is set to peak or plateau for the first time in the agency's history of modelling, with oil demand levelling off in the middle of the next decade.

The White House has given no timeline for completing a policy review on Saudi Arabia.

The US has stressed that the cut would boost Russia's foreign earnings and blunt the effectiveness of sanctions imposed over its invasion of Ukraine.

The United Arab Emirates and Bahrain, which like Saudi Arabia are US allies as well as Opec partners, also defended the cartel's decision as a 'technical' move.

Biden's announcement came a day after Democratic Senator Bob Menendez said the US must immediately freeze all cooperation with Saudi Arabia, including arms sales.

Fuel use has rebounded from the 2020 pandemic-induced slump but high prices have eaten into growth projections for 2022 and fed into expectations for slower growth in 2023.

The Opec+ group decided to add 648,000 barrels per day to the market in July, up from the 432,000 bpd increases in recent months, and a shift from the cartel's recent stance of sticking to a planned pace of monthly production hikes.