Oil prices inched lower on Monday after OPEC+ agreed to further increase its output targets from August while exports from key producers via the Strait of Hormuz are recovering, potentially adding to global supplies.
Zhang Fengguo | Xinhua News Agency | Getty Images
Oilprices inched lower on Monday after OPEC+ agreed to further increase its output targets from August while exports from key producers via the Strait of Hormuz are recovering, potentially adding toglobalsupplies.
Brent crude futuresslid 24 cents, or 0.33%, to $71.88 a barrel by 0010 GMT after settling 0.45% higher on Friday. U.S. West Texas Intermediate crudewas at $68.58 a barrel, down 11 cents, or 0.16%. There was no settlement for WTI on Friday as U.S. markets were closed ahead of the Independence Day holiday on Saturday.
Both contracts were little changed last week, after mostly falling over the past few weeks, as investors kept a close eye on talks between the United States and Iran over the fate of shipping through the Strait of Hormuz while keeping tabs on the recovery in Gulfoilexports.
The Organization of the Petroleum Exporting Countries and their allies including Russia agreed on Sunday to furtherincrease output targetsby 188,000 barrels per day from August, on top of similar increases for June and July.
However, the increase has remained largely on paper because of the U.S.-Israeli war with Iran, which closed the Strait of Hormuz to tanker traffic for key OPEC producers, including Saudi Arabia, Kuwait and Iraq, capping their output.
“The number was largely in line with expectation,” IG market analyst Tony Sycamore said,
“With UAE leaving and when quotas are probably still not being met due to production still ramping up after the conflict – I’m not sure they mean much at the moment.”
The United Arab Emirates quit OPEC as of May 1.
Gulf members have begun reviving supplies shut during the Iran war and are increasing exports.
OPECoiloutput in Junerose by 3.3 million barrels per day month-on-month to 19.43 million bpd, a Reuters survey found, recovering from its lowest in more than two decades.
Gulfoilexportsin June jumped more than 3 million barrels from May to exceed 10 million barrels per day, although the volume remained 40% below pre-war levels, data showed.
In addition,oilshipments fromRussia’s western portshit a record high in June and are expected to maintain that level in July as its refineries have been damaged in drone attacks by Ukraine that have forced Moscow to boost crude exports, industry sources said.
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