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New Indian Express
2 hours ago
- Business
- New Indian Express
OPEC+ to hike July oil production after Trump urges Saudi to increase output
VIENNA: Saudi Arabia, Russia and six other key OPEC+ members announced on Saturday a huge increase in crude production for July. They will produce an additional 411,000 barrels a day -- the same target set for May and then June -- according to a statement, which is more than three times greater than the group had previously planned. In recent years the 22-nation group had agreed to daily reductions of 2.2 million barrels with the aim of boosting prices. But in early 2025, leading members of the group known as the "Voluntary Eight", or V8, decided on the gradual output increase and subsequently began to accelerate the pace. The moves have resulted in oil prices plummeting to around $60 per barrel, the lowest level in four years. Trump pressure OPEC+ "struck three times: (the output target for) May was a warning, June a confirmation and July a warning shot", Rystad Energy analyst Jorge Leon told AFP. "The scale of the production increase reflects more than just internal supply dynamics," he said. "This is a strategic adjustment with geopolitical aims: Saudi Arabia seems to be bowing to Donald Trump's requests." Shortly after taking office, the US president called on Riyadh to ramp up production in order to bring down oil prices, meaning cheaper prices at the pump for American consumers. Saturday's decision comes after a meeting of all OPEC ministers on Wednesday, where the alliance's collective production policy was reaffirmed. The decision is officially justified by "healthy market fundamentals" covering oil reserves and structural demand growth during coming months. Riyadh 'angry' But markets have met this view with scepticism amid concerns about demand and a trade war launched by the United States. Analysts see several possible motivations for the production hikes, one of them being Saudi Arabia and others penalising members for not keeping to their quotas under the cuts first agreed in 2022. The increase is all the more likely due to "the latest statements of Kazakh Energy Minister Yerlan Akkenzhenov, who has apparently already informed OPEC that his country will not reduce production," said Thu Lan Nguyen, an analyst at Commerzbank. "Saudi Arabia is angry with Kazakhstan", which is seen as one of the main laggards, and which "produced 300,000 barrels per day more than its quota," said Bjarne Schieldrop, an analyst at SEB. Analysts meanwhile do not foresee a plunge in oil prices when markets open Monday as the announcement was largely anticipated, instead resulting in a "moderate" reaction. On Friday, the benchmark Brent crude futures price had settled at $62.61 per barrel, while West Texas Intermediate was at $60.79.
Yahoo
3 hours ago
- Business
- Yahoo
Oil finishes down on possible OPEC+ output hike
By Erwin Seba HOUSTON (Reuters) -U.S. crude futures fell on Friday as traders expected OPEC+ would decide on Saturday to boost oil output for July beyond previous forecasts. Brent crude futures settled down 25 cents, or 0.39%, at $63.90 a barrel. U.S. West Texas Intermediate crude finished down 15 cents, or 0.25%, at $60.79 a barrel, having earlier dropped more than $1 a barrel. The Brent July futures contract is due to expire on Friday. The more liquid August contract was down 71 cents, or 1.12%, at $62.64 a barrel. At these levels, the front-month benchmark contracts were headed for weekly losses over 1%. Prices dipped into negative territory after Reuters reported that OPEC+ may discuss an increase in July output larger than the 411,000 barrels per day (bpd) rise that the group decided on for May and June. "What OPEC+ is planning doesn't look particularly supportive for the oil market," said Matt Smith, Kpler's lead analyst for the Americas. The potential OPEC+ output hike comes as the global surplus has widened to 2.2 million bpd, likely necessitating a price adjustment to prompt a supply-side response and restore balance, said JPMorgan analysts in a note, adding that they expected prices to remain within the current range before easing into the high $50s by year-end. Phil Flynn, a senior analyst with Price Futures Group, said an online post on Truth Social by U.S. President Donald Trump that seemed to threaten more changes in tariff levels for Chinese imports also put pressure on crude prices. "Trump's Truth Social message on China failing to observe a truce on tariffs also combined with the Reuters headline to push prices down," Flynn said. Trump's tariffs were expected to remain in effect after a federal appeals court temporarily reinstated them on Thursday, reversing a trade court's decision a day earlier to put an immediate block on the sweeping duties. U.S. energy firms this week cut the number of oil and natural gas rigs operating for a fifth week in a row to the lowest since November 2021, energy services firm Baker Hughes said in its closely followed report on Friday. It was the first time since September 2023 that the number of rigs declined for five straight weeks. Baker Hughes said this week's decline put the total count down by 37 rigs, or 6%, from this time last year. Oil rigs fell by four to 461 this week, their lowest since November 2021, the company said. Gas rigs rose by one to 99.
France 24
6 hours ago
- Business
- France 24
OPEC+ announces sharp increase in July oil production
They will produce an additional 411,000 barrels a day -- the same target set for May and then June -- according to a statement, which is more than three times greater than the group had previously planned. In recent years the 22-nation group had agreed to daily reductions of 2.2 million barrels with the aim of boosting prices. But in early 2025, leading members of the group known as the "Voluntary Eight", or V8, decided on the gradual output increase and subsequently began to accelerate the pace. The moves have resulted in oil prices plummeting to around $60 per barrel, the lowest level in four years. Trump pressure OPEC+ "struck three times: (the output target for) May was a warning, June a confirmation and July a warning shot", Rystad Energy analyst Jorge Leon told AFP. "The scale of the production increase reflects more than just internal supply dynamics," he said. "This is a strategic adjustment with geopolitical aims: Saudi Arabia seems to be bowing to Donald Trump's requests." Shortly after taking office, the US president called on Riyadh to ramp up production in order to bring down oil prices, meaning cheaper prices at the pump for American consumers. Saturday's decision comes after a meeting of all OPEC ministers on Wednesday, where the alliance's collective production policy was reaffirmed. The decision is officially justified by "healthy market fundamentals" covering oil reserves and structural demand growth during coming months. Riyadh 'angry' But markets have met this view with scepticism amid concerns about demand and a trade war launched by the United States. Analysts see several possible motivations for the production hikes, one of them being Saudi Arabia and others penalising members for not keeping to their quotas under the cuts first agreed in 2022. The increase is all the more likely due to "the latest statements of Kazakh Energy Minister Yerlan Akkenzhenov, who has apparently already informed OPEC that his country will not reduce production," said Thu Lan Nguyen, an analyst at Commerzbank. "Saudi Arabia is angry with Kazakhstan", which is seen as one of the main laggards, and which "produced 300,000 barrels per day more than its quota," said Bjarne Schieldrop, an analyst at SEB. Analysts meanwhile do not foresee a plunge in oil prices when markets open Monday as the announcement was largely anticipated, instead resulting in a "moderate" reaction. On Friday, the benchmark Brent crude futures price had settled at $62.61 per barrel, while West Texas Intermediate was at $60.79.
Business Insider
10 hours ago
- Business
- Business Insider
Dangote refinery extends U.S. crude buying spree into July
Dangote oil refinery plans to import at least five million barrels of U.S. West Texas Intermediate (WTI) crude oil in July, according to three trading sources familiar with the matter. The Dangote Refinery plans to import 5 million barrels of U.S. WTI crude oil in July 2023. The refinery has secured its July deliveries through tenders awarded to Vitol, Socar, and Glencore. The refinery's challenges include securing sufficient local crude supplies, supplemented by international imports. Dangote oil refinery plans to import at least five million barrels of U.S. West Texas Intermediate (WTI) crude oil in July, according to three trading sources familiar with the matter. The massive refinery, with a capacity of 650,000 barrels per day, is set to import around 161,000 barrels per day (bpd) of WTI crude in July after awarding tenders in recent days, the sources said. This comes after a record 300,000 bpd was booked in its June tenders. Commodity trader Vitol secured two million barrels for July delivery in the latest Dangote tender, Azerbaijan's state-owned Socar provided another two million barrels, and miner and trader Glencore sold the remaining one million barrels, Reuters reported. The sellers of the nine million barrels Dangote planned to import for June, according to an earlier tender, were not confirmed, as tender details are not publicly disclosed. Africa's largest refinery, the $20 billion Dangote Petroleum Refinery, has been sourcing crude oil from international suppliers to supplement its domestic deliveries as it continues to scale up operations. Dangote's previous record for U.S. crude imports was 173,000 bpd in April, according to data from global shipping analytics firm Kpler. Despite its massive capacity, making it larger than Europe's ten biggest refineries, Dangote Refinery has struggled to secure adequate crude supplies locally. To address this, founder Aliko Dangote announced that the company would source crude from other African-producing nations to maintain production levels. Dangote Petroleum Refinery and the state-owned Nigerian National Petroleum Company Limited (NNPC) have had disagreements, particularly regarding the naira for crude deal. However, in March, NNPC confirmed ongoing negotiations for a new naira-for-crude deal with Dangote Petroleum Refinery.
Ammon
13 hours ago
- Business
- Ammon
Oil finishes down on possible OPEC+ output hike
Ammon News - U.S. crude futures fell on Friday as traders expected OPEC+ would decide on Saturday to boost oil output for July beyond previous forecasts. Brent crude futures settled down 25 cents, or 0.39%, at $63.90 a barrel. U.S. West Texas Intermediate crude finished down 15 cents, or 0.25%, at $60.79 a barrel, having earlier dropped more than $1 a barrel. The Brent July futures contract is due to expire on Friday. The more liquid August contract was down 71 cents, or 1.12%, at $62.64 a barrel. Reuters
