Monday, 05 May 2025 04:31

Oil falls further as OPEC+ accelerates output hikes

Rate this item
(0 votes)

Oil prices fell more than $2 a barrel in early Asian trade on Monday as OPEC+ is set to further speed up oil output hikes, spurring concerns about more supply.

Brent crude futures dropped $2.04 a barrel, or 3.33%, to $59.25 a barrel by 2240 GMT while U.S. West Texas Intermediate crude was at $56.19 a barrel, down $2.10, or 3.60%.

Both contracts touched their lowest since April 9 at Monday's open after OPEC+ agreed to accelerate oil production hikes for a second consecutive month, raising output in June by 411,000 barrels per day (bpd).

The June increase from the eight will take the total combined hikes for April, May and June to 960,000 bpd, representing a 44% unwinding of the 2.2 million bpd of various cuts agreed on since 2022, according to Reuters calculations.

"The May 3 OPEC+ decision to raise production quotas another 411,000 bpd for June adds to the market expectation that the global supply/demand balance is moving to a surplus," Tim Evans, founder of Evans on Energy said in a note.

The group could fully unwind its voluntary cuts by the end of October if members do not improve compliance with their production quotas, OPEC+ sources told Reuters.

OPEC+ sources have said Saudi Arabia is pushing OPEC+ to accelerate the unwinding of earlier output cuts to punish fellow members Iraq and Kazakhstan for poor compliance with their production quotas.

Barclays lowered its Brent forecast by $4 to $66 a barrel for 2025 and by $2 to $60 a barrel for 2026 because of the accelerated phase out by OPEC+, analyst Amarpreet Singh said in a note.

Meanwhile, tensions flared in the Middle East after Israeli Prime Minister Benjamin Netanyahu vowed to retaliate against Iran for the Tehran-backed Houthi group firing a missile that landed near Israel's main airport.

Iran's Defence Minister Aziz Nasirzadeh said on Sunday that Tehran would strike back if the United States or Israel attacked.

 

Reuters

May 29, 2025

Nigeria yields top fuel importer status to South Africa - Report

Nigeria has relinquished its long-held position as Africa’s largest importer of refined petroleum products following…
May 28, 2025

PDP govs facing intimidation from Tinubu administration, says Bala Mohammed

Bauchi State Governor and chairman of the Peoples Democratic Party (PDP) Governors’ Forum, Bala Mohammed,…
May 26, 2025

Looks matter In leadership. Here’s why that’s not superficial

Julian Hayes II Life offers a series of uncomfortable truths, often rooted not in surface-level…
May 24, 2025

Woman forced to clean off makeup after failing airport facial recognition scans

A Chinese woman was allegedly forced to take off her heavy makeup after facial recognition…
May 29, 2025

18 soldiers, 15 police officers arrested for selling arms to criminals, Nigerian Army says

Troops of operation Hadin Kai (OPHK) have arrested 18 serving soldiers and 15 police officers…
May 29, 2025

Here’s the latest as Israel-Hamas war enters Day 601

Netanyahu says Hamas Gaza chief Mohammad Sinwar has been killed Israeli Prime Minister Benjamin Netanyahu…
May 29, 2025

AI system resorts to blackmail when its developers try to replace it

An artificial intelligence model has the ability to blackmail developers — and isn’t afraid to…
May 13, 2025

Nigeria's Flying Eagles qualify for World Cup after dramatic win over Senegal

Nigeria's U-20 national football team, the Flying Eagles, have secured their place at the 2025…

NEWSSCROLL TEAM: 'Sina Kawonise: Publisher/Editor-in-Chief; Afolabi Ajibola: IT Manager;
Contact Us: [email protected] Tel/WhatsApp: +234 811 395 4049

Copyright © 2015 - 2025 NewsScroll. All rights reserved.