OPEC+ countries to boost oil production by 547,000 barrels per day
The group met virtually on Sunday and announced that eight of its member countries would increase oil production by 547,000 barrels per day in September.
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BP increases staff cuts to 6,200 and signals further possible reductions
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Oil prices decline again amid worries about Opec+ supply hikes
Oil (BZ=F, CL=F) Oil prices moved lower on Tuesday, continuing a downward trajectory for August, as concerns about both supply and demand weigh heavily on traders' minds. Brent crude (BZ=F) dipped 0.6% in early trade to $68.34 per barrel. Over the past five sessions prices have dipped nearly 5.8%. West Texas Intermediate (CL=F) followed a similar trajectory, sliding 0.8% by 8.45am in London. Prices were around $65.80 per barrel and have lost about 4.9% over the past five sessions. Anxiety is high following a decision by the Organization of the Petroleum Exporting Countries and its allies (Opec+) to hike output by 547,000 barrels per day in September. The increases add to oversupply concerns surrounding the US's oil consumption. The production increase marks the full and early reversal of Opec+'s most significant supply cuts, which had been implemented to support prices during the pandemic. It also includes a separate boost for the United Arab Emirates (UAE), raising total output by about 2.5 million bpd, roughly 2.4% of global oil demand. Opec+ justified the move by citing a resilient global economy and low stockpiles. There are worries that the group will increase supply again after September, with discussions about unwinding a further 1.65 million bpd of cuts at the group's next meeting on 7 September ratcheting up tensions. Pound (GBPUSD=X, GBPEUR=X) The pound erased Monday's gains against the dollar in early trade on Tuesday, pulling around 0.2% lower to the $1.326 mark. The currency pair has been volatile over the past week amid a glut of economic data highlighting concerns about the health of the US economy. Notably, the US jobs report on Friday missed expectations for July and revised down earlier numbers. As such, the dollar index ( dipped around 1% over the past five sessions. For the year-to-date the index, which tracks the world's reserve currency against a basket of six other currencies, is nearly 9% lower. "The chunky downward revisions showed an average hiring pace of 35,000, prompting US president Donald Trump to instruct his team to fire the Bureau of Labor Statistics (BLS) chief Erika McEntarffer amid claims of rigged data," said Aaron Hill, chief analyst at FP Markets. "Ironically, the disappointing jobs report saw investors price in the possibility of a September rate cut, which is what Trump has been calling for." Meanwhile, sterling enjoyed modest gains against the euro with fresh data related to services PMIs on deck. The pound was just below the 1.15 euro mark by 9am in London, having advanced about 0.1%. Gold (GC=F) Gold prices searched for direction on Tuesday, hovering around the flatline in the absence of any dramatic economic data or market-shifting world events. Gold (GC=F) futures touched $3,428 per ounce, while the spot price moved slightly lower to the $3,371 per ounce mark. The calm day of trade followed a move by Citi (C) to upgrade its gold price forecast. On Monday it raised its forecast to $3,500 per ounce over the next three months, up from a previous estimate of $3,300. The bank also adjusted its expected trading range to $3,300–$3,600 from $3,100–$3,500, citing a deteriorating near-term US growth and inflation outlook. "US growth and tariff-related inflation concerns are set to remain elevated during [the second half], which, alongside a weaker dollar, are set to drive gold moderately higher, to new all-time highs," Citi stated in its report. The bank also noted that gross gold demand has surged by over a third since mid-2022, contributing to the dramatic rise in prices, which are expected to nearly double by the second quarter of while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
CNBC
15 minutes ago
- CNBC
Oil little changed after hitting one-week low, oversupply concerns linger
Oil prices were little changed on Tuesday after three days of declines on mounting oversupply concerns after OPEC+ agreed to another large output increase in September, though the potential for more Russian supply disruptions supported the market. Brent crude futures were unchanged at $68.76 a barrel by 0036 GMT while U.S. West Texas Intermediate crude was at $66.27 a barrel, down 2 cents, or 0.03%. Both contracts fell by more than 1% in the previous session to settle at their lowest in a week. The Organization of the Petroleum Exporting Countries and its allies, together known as OPEC+, pumps about half of the world's oil and had been curtailing production for several years to support the market, but the group introduced a series of accelerated output hikes this year to regain market share. In its latest decision, OPEC+ agreed on Sunday to raise oil production by 547,000 barrels per day for September. It marks a full and early reversal of the group's largest tranche of output cuts, amounting to about 2.5 million bpd, or about 2.4% of global demand, though analysts caution the actual amount returning to the market will be less. At the same time, U.S. demands for India to stop buying Russian oil as Washington seeks ways to push Moscow for a peace deal with Ukraine is increasing concerns of a disruption to supply flows. U.S. President Donald Trump is threatening to impose 100% secondary tariffs on Russian crude buyers. This follows a 25% tariff on Indian imports announced in July. India is the biggest buyer of seaborne crude from Russia, importing about 1.75 million bpd of Russian oil from January to June this year, up 1% from a year ago, according to data provided to Reuters by trade sources. "India has become a major buyer of the Kremlin's oil since the 2022 invasion of Ukraine. Any disruption to those purchases would force Russia to find alternative buyers from an increasingly small group of allies," ANZ senior commodity strategist Daniel Hynes wrote in a note. Traders are also awaiting any developments on the latest U.S. tariffs on its trading partners, which analysts fear could slow down economic growth and dampen fuel demand growth.
