LONDON, Oct 10 Reuters Saudi Arabia and Russia39;s crude supply cuts in tandem with U.S. interest rate rises have disrupted oil39;s tendency to move in the opposite direction to the U.S. dollar, although analysts say the darkening economic outlook will eventually restore the equation.

A strong dollar typically weighs on oil prices as it makes the commodity more expensive for holders of other currencies, dampening demand for crude.

The reason both have moved higher at the same time is because the U.S. has hiked interest rates to stem inflation while top OPEC oil producers Saudi Arabia and Russia have voluntarily cut production beyond OPEC agreements.

Oil prices in September hit 10month highs as Saudi Arabia and Russia cut a combined 1.3 million barrels per day bpd of supply until the end of the year.

The dollar has strengthened in response to interest rate hikes, and investors have priced in expectations that rates will stay high for longer as central banks struggle to rein in inflation. Higher energy costs have contributed to those inflationary pressure in recent months.

While it is not uncommon for oil39;s inverse relationship with the dollar to be temporarily disrupted, over the long term the inverse relationship has endured.

When Brent prices hit an alltime high of above 147 a barrel in early July 2008, the dollar was also moving in the same direction as crude, but the correlation was narrower than current levels, LSEG data shows.

Over the past two decades, the…