Oil prices jumped after the OPEC+ decision
Kyiv • UNN
OPEC+ decided to increase oil production in July by 411,000 barrels per day. Brent and WTI oil prices rose after falling last week.
Oil prices recovered by more than $1 a barrel on Monday after the OPEC+ producers' group decided to increase production in July by the same amount as in each of the previous two months, which was a relief to those who expected a larger increase, UNN reports, citing Reuters.
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Brent crude futures rose $1.34, or 2.13%, to $64.12 a barrel by 03:46 GMT (06:46 Kyiv time) after falling 0.9% on Friday. US West Texas Intermediate crude was at $62.31 a barrel, up $1.52, or 2.5%, after falling 0.3% in the previous session.
Both grades fell in price by more than 1% last week.
The Organization of the Petroleum Exporting Countries and its allies decided on Saturday to increase production by 411,000 barrels per day in July, the third month that the group, known as OPEC+, has increased by the same amount as it seeks to regain market share and punish for overproduction.
The group was expected to discuss a more significant increase in production.
"If they had gone for an unexpectedly larger volume, the opening price on Monday would have been really ugly," analyst Harry Tchilinguirian of Onyx Capital Group wrote on LinkedIn.
Oil traders said the 411,000 bpd increase was already priced into Brent and WTI futures.
"The main motive was focused on punishing OPEC+ members such as Iraq and Kazakhstan, who have consistently produced more than they promised," Commonwealth Bank of Australia said in a note on Monday.
Looking ahead, Goldman Sachs analysts expect OPEC+ to eventually increase production by 0.41 million barrels per day in August.
Meanwhile, low fuel inventories in the US have raised concerns about supply ahead of expectations for an above-average hurricane season, analysts say.
Traders are also closely monitoring the impact of lower prices on US oil production, which hit an all-time high of 13.49 million barrels per day in March.
