Oil Prices Drop Again Ahead of OPEC+ Production Decision
World oil prices fell again for the second day in a row on Friday (4/7), ahead of the important OPEC+ meeting scheduled for this weekend. What caused it? Traders are preparing for the possibility of a fourth increase in oil production from the producer group, by 411,000 barrels per day for August. Brent fell 1.2% to $67.98 per barrel and WTI fell to $66.22 per barrel.
The OPEC+ meeting was initially scheduled for Sunday, but was moved up to Saturday, accelerating market speculation. OPEC+ delegates have discussed plans for additional supply as an effort to maintain price stability amidst dynamic global conditions. Oil traders also expect price movements to be more volatile because Friday's trading coincides with the US Independence Day holiday.
Another factor that is weighing on oil prices is the new tariff policy from US President Donald Trump. Trump plans to send letters to trading partner countries about the new tariffs that will take effect starting in August. The uncertainty of this global trade policy has made market sentiment increasingly cautious, including in the energy sector.
On the other hand, the oil market is still overshadowed by geopolitical concerns, including the potential for an Israel-Iran conflict and nuclear negotiations between the US and Iran. Washington plans to resume nuclear talks with Tehran next week, and has taken steps to clamp down on Iranian oil trade. This could impact global supply if the situation escalates.
In addition, Canadian oil production has also been affected by wildfires in Fort McMurray, near the main oil sands production area. Coupled with falling production in Mexico and a ban on exports from Venezuela, these conditions should support prices. However, for now, the market is more concerned about the potential for excess supply from OPEC+.
Source: (ayu-newsmaker)
