Oil Tumbles As OPEC+ Hikes August Output More Than Expected
Oil prices slipped on Monday after OPEC+ surprised markets by hiking output more than expected in August, while uncertainty over U.S. tariffs and their potential impact on global economic growth weighed on demand expectations.
Brent crude futures fell 47 cents, or 0.69%, to $67.83 a barrel by 0327 GMT, while U.S. West Texas Intermediate crude was at $66.05, down $0.95, or 1.42%.
The Organization of the Petroleum Exporting Countries and their allies, a group known as OPEC+, agreed on Saturday to raise production by 548,000 barrels per day in August.
"The increased production clearly represents a more aggressive competition for market share and some tolerance for the resulting decline in price and revenue," Tim Evans of Evans Energy said in a note.
The August increase represents a jump from monthly increases of 411,000 bpd OPEC+ had approved for May, June and July, and 138,000 bpd in April.
The decision will bring nearly 80% of the 2.2 million bpd voluntary cuts from eight OPEC producers back into the market, RBC Capital analysts led by Helima Croft said in a note.
However, the actual output increase has been smaller than planned so far and most of the supply has been from Saudi Arabia, they added.
In a show of confidence in oil demand, Saudi Arabia on Sunday raised the August price for its flagship Arab Light crude to a four-month high for Asia.
Source: (ayu-newsmaker)
