U.S. crude oil falls more than 3% as OPEC+ plans to phase out voluntary production cuts

The OPEC logo on the building of the Organization of the Petroleum Exporting Countries.
Thomas Coex | Afp | Getty Images

Crude oil futures were little changed on Monday as investors tried to parse the impact OPEC’s weekend decision on production policy will have on the market.

OPEC+ agreed to extend 3.6 million barrels per day in production cuts through the end of 2025. But Saudi Arabia, Russia and several other countries will gradually phase out a separate round of 2.2 million bpd in cuts over 12 months starting this October.

Here are today’s energy prices:

  • West Texas Intermediate July contract: $76.91 a barrel, down 8 cents. Year to date, U.S. crude oil has gained 7.1%.
  • Brent August contract: $81.06 a barrel, down cents. Year to date, the global benchmark has gained 5%.
  • RBOB Gasoline July contract: $2.42 a gallon, up 0.24%. Year to date, gasoline futures are up 15%.
  • Natural Gas July contract: $2.74 per thousand cubic feet, up 6.11%. Year to date, gas is up 11.3%.

“It now appears OPEC+ will add volumes to the market beginning in Q4’24 which may create a modest oversupply and downward price pressures,” Wells Fargo analysts led by Roger Read told clients in a note.

But JPMorgan analysts said the decision by OPEC+ Sunday is largely neutral for global oil prices in 2024. The production cuts combined with summer driving should increase Brent prices by $10 to the $90-per-barrel range by September, according to the investment bank.

Articles You May Like

Trump shot in assassination attempt at rally that leaves spectator and gunman dead
New environment secretary Reed summons water bosses for urgent talks
AT&T’s massive data breach deepens crisis for Snowflake seven weeks after hack was disclosed
Dozens killed in Israeli airstrike outside school in Gaza
Strictly Come Dancing star leaves show amid reports of alleged misconduct