Oil prices continue to decline for the second consecutive day as investors anticipate that OPEC countries and their allies may decide to increase production at their upcoming meeting. According to Reuters, Brent crude futures fell by 24 cents (0.4%) to $64.50 per barrel, while WTI crude prices decreased by 29 cents (0.5%) to $61.24 per barrel.
This is reported by Finway
OPEC+ Forecasts and Decisions
Daniel Hynes, an analyst at ANZ Bank, explained:
“Prices have dipped slightly as the market factors in the possibility of increased supplies from OPEC.”
The final decision regarding production levels for July is expected to be made on May 28 during an online meeting of OPEC+ ministers. According to Reuters, one of the topics under discussion is an increase in production by 411,000 barrels per day.
Russian Prime Minister Alexander Novak noted that there have been no official discussions regarding an increase in production at this time. Meanwhile, eight OPEC+ countries that previously voluntarily reduced their production levels plan to meet on May 31, one day earlier than the scheduled date.
Impact of External Factors on the Market
OPEC+ countries have already agreed to accelerate production growth for June for the second consecutive time. In turn, U.S. President Donald Trump’s decision to postpone trade negotiations with the European Union until July 9 has positively impacted the market, as it reduced the risk of new tariffs that could negatively affect oil demand.
Additionally, Iran announced a new official price for its light crude oil for the Asian market, which will now be $1.80 higher than the average Oman/Dubai price index for June, compared to a $1.65 premium in May. Iranian President Masoud Pezeshkian emphasized that the country will be able to bear the burden even if nuclear negotiations with the U.S. fail. In such a case, sanctions will remain in place, limiting Iranian oil exports and supporting global prices.