Oil prices up; strong demand outweighs surprisingly big OPEC+ output hike
Oil prices rose nearly 2% on Monday as signs of strong demand more than offset the impact of a higher-than-expected OPEC+ output hike for August and fresh concerns about the potential impact of U.S. tariffs.
Brent crude futures settled up $1.28, or 1.9%, at $69.58. U.S. West Texas Intermediate crude settled up 93 cents or 1.4%, at $67.93. Early in the session, Brent had fallen as low as $67.22 and WTI's session low was $65.40.
Travel industry statistics released last week showed that a record number of Americans had been set to travel for the Fourth of July holiday by road and air.
On Saturday, the Organization of the Petroleum Exporting Countries and allies in OPEC+ agreed to raise production by 548,000 barrels per day in August, exceeding the 411,000-bpd hikes they made for the prior three months.
The OPEC+ 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, analysts said.
In a show of confidence about oil demand, Saudi Arabia on Sunday raised the August price for its flagship Arab Light crude to a four-month high for Asia.
Source : Reuters
