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The Star
23-05-2025
- Business
- The Star
Oil falls on potential further hike in Opec+ output
HOUSTON: Oil prices slipped on Thursday as investors weighed a report that Opec+ is discussing a production increase for July, stoking concerns that global supply could outpace demand growth. Brent futures fell 66 cents, or 1.02%, to US$64.25 a barrel by 12:31 p.m. EDT. US West Texas Intermediate crude was down 51 cents, or 0.83%, at US$61.06. The Organization of the Petroleum Exporting Countries and its allies, known collectively as Opec+, are discussing whether to make another large output increase at their meeting on June 1, Bloomberg News reported. An increase of 411,000 barrels per day for July is among the options under discussion, though no final agreement has been reached, the report said, citing delegates. "The Opec+ speculation is the biggest factor today," said John Kilduff, partner at Again Capital in New York. "This Opec+ decision is going to be pretty weighty, and it is not helping that Kazakhstan did not come through last month," he added. Kazakhstan's oil production has risen by 2% in May, an industry source said on Tuesday. Reuters previously reported that the group planned to accelerate output increases and could bring back as much as 2.2 million bpd by November. Opec+ has been in the process of unwinding production cuts, with additions to the market in May and June. "We're seeing the market reacting to evidence that Opec is letting go of a strategy to defend price in favour of market share," said Harry Tchiliguirian at Onyx Capital Group. "It's a bit like taking off a Band-Aid; you do it in one fell swoop." RBC Capital analyst Helima Croft said in a note on Wednesday that a 411,000-bpd increase from July is the "most likely outcome" from the meeting, primarily from Saudi Arabia. "A key question will be whether the voluntary cut will be fully drawn down before the leaves turn brown in many parts of the world, in line with the original taper schedule," she said. Prices were already lower in the session after Energy Information Administration data released on Wednesday showed US crude and fuel inventories showed surprise stock builds last week as crude imports hit a six-week high and gasoline and distillate demand slipped. Crude inventories rose by 1.3 million barrels to 443.2 million barrels in the week ended May 16, the EIA said. Analysts in a Reuters poll had expected a drawdown of 1.3 million barrels. The EIA's surprise stock builds will exert downward pressure on prices, particularly on WTI, said Emril Jamil at LSEG Oil Research, adding that this could further encourage more US exports to Europe and Asia. Curbing losses on Thursday, US oil company Chevron's license to operate in Venezuela will expire on May 27, US Secretary of State Marco Rubio said in a post on his personal X account late on Wednesday. "This statement by Rubio could be a game changer. But these deadlines have been extended in the past, so maybe the market is just not convinced yet," said Phil Flynn, senior analyst with Price Futures Group. — Reuters
Business Times
22-05-2025
- Business
- Business Times
Oil prices settle down on potential further increase in Opec+ output
[HOUSTON] Oil prices settled lower on Thursday as investors weighed a report that Opec+ is discussing a production increase for July, stoking concerns that global supply could outpace demand growth. Brent futures settled down 47 cents, or 0.72 per cent, to US$64.44 a barrel. US West Texas Intermediate crude settled down 37 cents, or 0.6 per cent, at US$61.20. The Organization of the Petroleum Exporting Countries and its allies, known collectively as Opec+, are discussing whether to make another large output increase at their meeting on June 1, Bloomberg News reported. An increase of 411,000 barrels per day for July is among the options under discussion, though no final agreement has been reached, the report said, citing delegates. 'The Opec+ speculation is the biggest factor today,' said John Kilduff, partner at Again Capital in New York. 'This Opec+ decision is going to be pretty weighty, and it is not helping that Kazakhstan did not come through last month,' he added. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Kazakhstan's oil production has risen by 2 per cent in May, an industry source said on Tuesday. Output increases Reuters previously reported that the group planned to accelerate output increases and could bring back as much as 2.2 million bpd by November. Opec+ has been in the process of unwinding production cuts, with additions to the market in May and June. 'We're seeing the market reacting to evidence that Opec is letting go of a strategy to defend price in favour of market share,' said Harry Tchiliguirian at Onyx Capital Group. 'It's a bit like taking off a Band-Aid; you do it in one fell swoop.' RBC Capital analyst Helima Croft said in a note on Wednesday that a 411,000-bpd increase from July is the 'most likely outcome' from the meeting, primarily from Saudi Arabia. 'A key question will be whether the voluntary cut will be fully drawn down before the leaves turn brown in many parts of the world, in line with the original taper schedule,' she said. Prices were already lower in the session after Energy Information Administration data released on Wednesday showed US crude and fuel inventories showed surprise stock builds last week as crude imports hit a six-week high and petrol and distillate demand slipped. Crude inventories rose by 1.3 million barrels to 443.2 million barrels in the week ended May 16, the EIA said. Analysts in a Reuters poll had expected a drawdown of 1.3 million barrels. The EIA's surprise stock builds will exert downward pressure on prices, particularly on WTI, said Emril Jamil at LSEG Oil Research, adding that this could further encourage more US exports to Europe and Asia. Curbing losses on Thursday, US oil company Chevron's license to operate in Venezuela will expire on May 27, US Secretary of State Marco Rubio said in a post on his personal X account late on Wednesday. 'This statement by Rubio could be a game changer. But these deadlines have been extended in the past, so maybe the market is just not convinced yet,' said Phil Flynn, senior analyst with Price Futures Group. REUTERS
Observer
22-05-2025
- Business
- Observer
Oil prices fall 1% on potential OPEC+ increase
LONDON:Oil prices fell 1% on Thursday after a report that OPEC+ is discussing a production increase for July, stoking concerns that global supply could exceed demand growth. Brent futures fell 64 cents, or 1%, to $64.27 a barrel by 0800 GMT. US West Texas Intermediate crude dropped 59 cents, or 1%, to $60.98. The Organization of the Petroleum Exporting Countries and its allies, known collectively as OPEC+, are discussing whether to make another large output increase at their meeting on June 1, Bloomberg News reported. An increase of 411,000 barrels per day (bpd) for July is among the options under discussion, though no final agreement has been reached, the report said, citing delegates. "We're seeing the market reacting to evidence that OPEC is letting go of a strategy to defend price in favour of market share," said Harry Tchiliguirian at Onyx Capital Group. "It's a bit like taking off a Band-Aid; you do it in one fell swoop." OPEC+ has been in the process of unwinding output cuts, with additions to the market in May and June, and Reuters has previously reported that the group could bring back as much as 2.2 million bpd by November. In a note on Wednesday, RBC Capital analyst Helima Croft said that a 411,000 bpd increase from July is the "most likely outcome" from the meeting, primarily from Saudi Arabia. "A key question will be whether the voluntary cut will be fully drawn down before the leaves turn brown in many parts of the world, in line with the original taper schedule," she said. Prices were already lower in the session after Energy Information Administration data released on Wednesday showed US crude and fuel inventories showed surprise stock builds last week as crude imports hit a six-week high and gasoline and distillate demand slipped. Crude inventories rose by 1.3 million barrels to 443.2 million barrels in the week ended May 16, the EIA said. Analysts in a Reuters poll had expected a drawdown of 1.3 million barrels. The EIA's surprise stock builds will exert downward pressure on prices, particularly on WTI, said Emril Jamil at LSEG Oil Research, adding that this could further encourage more US exports to Europe and Asia. While OPEC+ deliberates, a rising yield on 10-year US Treasury bonds suggests that the producer group could be increasing oil supply into a market with lower demand.— Reuters
Gulf Insider
22-05-2025
- Business
- Gulf Insider
Oil Prices Dip On Report Of Another Potential OPEC+ Supply Boost
OPEC+ is considering a third straight monthly output hike, departing from the norm of stabilizing oil markets. According to Bloomberg, the group of 12 major oil-exporting nations, including Saudi Arabia, UAE, and others, is considering a July increase of 411,000 barrels per day (bpd)—roughly triple the previously planned amount. This would mirror supply increases in May and June. Such an increase in July could lead to a breakdown in Brent crude's $60-per-barrel price floor (as long as the war risk premium remains suppressed). Brent fell to $63 a barrel, down about 1.7% following the news. West Texas Intermediate dropped to around $60 a barrel. According to delegates, the increase would mark the third consecutive month of added supply, though they noted that no final agreement had been reached. Bloomberg provided more color about the strategy at play with OPEC+ that would only increase concerns about a global glut: The strategy appears aimed at disciplining quota violators by pushing prices lower. But it will add to the overall picture of oversupply — not only is there a chance of more Iranian barrels hitting the market, energy demand globally looks set to soften. 'We're seeing the market reacting to evidence that OPEC is letting go of a strategy to defend price in favour of market share,' said Harry Tchiliguirian at Onyx Capital Group, adding, 'It's a bit like taking off a Band-Aid; you do it in one fell swoop.' Click here to read more…
Reuters
22-05-2025
- Business
- Reuters
Oil prices fall more than 1% on potential further increase to OPEC+ output
LONDON, May 22 (Reuters) - Oil prices dropped by more than 1% on Thursday after a report that OPEC+ is discussing a production increase for July, stoking concerns that global supply could exceed demand growth. Brent futures fell 96 cents, or around 1.5%, to $63.95 a barrel by 1322 GMT. U.S. West Texas Intermediate crude was down 91 cents, also around 1.5%, at $60.66. Sign up here. The Organization of the Petroleum Exporting Countries and its allies, known collectively as OPEC+, are discussing whether to make another large output increase at their meeting on June 1, Bloomberg News reported. An increase of 411,000 barrels per day (bpd) for July is among the options under discussion, though no final agreement has been reached, the report said, citing delegates. Reuters previously reported that that the group planned to accelerate output increases and could bring back as much as 2.2 million bpd by November. OPEC+ has been in the process of unwinding production cuts, with additions to the market in May and June. "We're seeing the market reacting to evidence that OPEC is letting go of a strategy to defend price in favour of market share," said Harry Tchiliguirian at Onyx Capital Group. "It's a bit like taking off a Band-Aid; you do it in one fell swoop." In a note on Wednesday, RBC Capital analyst Helima Croft said that a 411,000 bpd increase from July is the "most likely outcome" from the meeting, primarily from Saudi Arabia. "A key question will be whether the voluntary cut will be fully drawn down before the leaves turn brown in many parts of the world, in line with the original taper schedule," she said. Prices were already lower in the session after Energy Information Administration data released on Wednesday showed U.S. crude and fuel inventories showed surprise stock builds last week as crude imports hit a six-week high and gasoline and distillate demand slipped. Crude inventories rose by 1.3 million barrels to 443.2 million barrels in the week ended May 16, the EIA said. Analysts in a Reuters poll had expected a drawdown of 1.3 million barrels. The EIA's surprise stock builds will exert downward pressure on prices, particularly on WTI, said Emril Jamil at LSEG Oil Research, adding that this could further encourage more U.S. exports to Europe and Asia. While OPEC+ deliberates, a rising yield on 10-year U.S. Treasury bonds suggests that the producer group could be increasing oil supply into a market with lower demand.
