Oil prices slip after OPEC+ agree to ease output cuts
Oil prices edged down in early Asian trade on Monday after OPEC+ agreed last week to gradually ease some of its production cuts between May and July, Reuters reports.
Brent crude futures for June fell 16 cents, or 0.2%, to $64.70 a barrel by 2351 GMT while U.S. West Texas Intermediate crude for May was at $61.32 a barrel, down 13 cents, or 0.2%.
Both contracts settled up more than $2 a barrel after the OPEC+ decision and on optimism about energy demand after U.S. President Joe Biden outlined a $2 trillion infrastructure spending plan.
The Organization of the Petroleum Exporting Countries, Russia and their allies, a group known as OPEC+, agreed to ease production curbs by 350,000 barrels per day (bpd) in May, another 350,000 bpd in June and further 400,000 bpd or so in July.
The decision came after the new U.S. administration called on Saudi Arabia to keep energy affordable for consumers despite demand concerns as parts of Europe remained under lockdown while Japan could expand emergency measures as needed to contain a new wave of coronavirus infections.
Under Thursday’s agreement, OPEC+ cuts would be just above 6.5 million bpd from May, compared with slightly below 7 million bpd in April.
Most of the increase in supplies will come from the world’s top exporter, Saudi Arabia, which said it was phasing out its extra voluntary cuts by July, a move that will add 1 million bpd.