Oil prices fall as OPEC+ weighs major production hike
Oil prices dropped following reports that OPEC+ members are weighing another substantial increase in output.
Brent slumped below $64 a barrel, after shedding about 1% over the previous two sessions, while West Texas Intermediate was near $61, News.Az reports, citing Bloomberg.
An increase of 411,000 barrels a day potentially agreed at a June 1 gathering — triple the amount initially planned — would be the third straight month of added supply, but no final agreement has been made, according to delegates.
Crude remains under pressure as the Organization of the Petroleum Exporting Countries and its allies push barrels back into a market that’s already looking well-supplied, ampifying concerns about a glut. The US-led trade war has also driven losses on concerns that the globe-spanning disruption will slow economic growth, hurting energy demand.
Rising US inventories, as well as weakness in wider markets, added to downward pressures. US commercial inventories of crude rose for a second week, according to data on Wednesday. In addition, gauges of gasoline and distillate demand were weak, even as the summer driving season approaches.
In broader markets, concerns about Washington’s ballooning deficit spurred declines in US stocks, government bonds and the dollar, with Asian equities following them lower. The ructions come at a time when investor appetite for US assets was already waning across the globe.
Elsewhere, the UK urged Group of Seven allies to cut their price cap on Russian oil, saying after a finance ministers’ meeting in Banff, Canada, that the move was necessary to put further pressure on President Vladimir Putin to end Moscow’s war in Ukraine.
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