Oil prices edged down slightly on Monday after the OPEC+ alliance agreed to further increase its production targets starting in August, while exports from major producers via the Strait of Hormuz show signs of recovery, potentially boosting global supply.
By 00:10 GMT, Brent crude futures fell 24 cents, or 0.33%, to $71.88 after closing 0.45% higher on Friday.
U.S. West Texas Intermediate (WTI) crude settled at $68.58 a barrel, down 11 cents, or 0.16%.
There was no settlement for WTI contracts on Friday, as U.S. markets were closed ahead of the Independence Day holiday on Saturday.
Both benchmarks were little changed last week, following predominantly downward movements over the past few weeks. Investors have been closely monitoring talks between the United States and Iran regarding the status of shipping traffic through the Strait of Hormuz, alongside tracking the recovery of oil exports from Gulf nations.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia—the group known as OPEC+—agreed on Sunday to raise production targets by 188,000 barrels per day (bpd) starting in August, following similar increases in June and July.
However, this increase remained largely on paper due to the U.S.-Israeli war with Iran, which blocked the Strait of Hormuz to oil tankers from major OPEC producers—including Saudi Arabia, Kuwait, and Iraq—consequently capping their output.
“The number was largely in line with expectations,” said Tony Sycamore, a market analyst at IG, adding: “With the UAE pulling back, and given the potential for quotas to not be met yet as production continues to ramp up post-conflict, I’m not sure these figures mean a great deal right now.”
Gulf member states have begun resuming supplies that were halted during the war with Iran, ramping up their exports.
A survey showed that OPEC oil production in June rose by 3.3 million bpd compared to the previous month, reaching 19.43 million bpd and recovering from its lowest level in over two decades.
Data showed that Gulf oil exports in June jumped by more than 3 million barrels compared to May, exceeding 10 million bpd, though this volume remained 40% below pre-war levels.
Additionally, oil shipments from Russia’s western ports hit a record high in June and are expected to maintain this level in July. Russian refineries suffered damage from Ukrainian drone strikes, forcing Moscow to increase its crude oil exports, according to industry sources.
Reuters
