Top Stories
Oil eases as Russia downplays additional OPEC+ cuts
Global Banking & Finance Review®
Company
LONDON (Reuters) -Oil prices fell on Thursday after Russian Deputy Prime Minister Alexander Novak played down the prospect of further OPEC+ production cuts at its meeting next week.
LONDON (Reuters) -Oil prices fell on Thursday after Russian Deputy Prime Minister Alexander Novak played down the prospect of further OPEC+ production cuts at its meeting next week.
Brent crude futures was down 41 cents, or 0.5%, to $77.95 a barrel at 0815 GMT. U.S. West Texas Intermediate crude (WTI) fell 51 cents, or 0.7%, to $73.83.
“I don’t think that there will be any new steps, because just a month ago certain decisions were made regarding the voluntary reduction of oil production by some countries…” Novak was quoted as saying by Izvestia newspaper.
In the previous session, oil prices were supported by a warning from Saudi Arabia’s energy minister that short-sellers betting oil prices will fall should “watch out” for pain.
Some investors took that as a signal that the Organization of Petroleum Exporting Countries (OPEC) and allies including Russia, together called OPEC+, could consider further output cuts at a meeting on June 4.
“The obvious reading is that the Kingdom may either unilaterally cut oil production or orchestrate a wider OPEC+ reduction …thereby supporting prices and stinging speculators that are shorting oil,” analysts at bank MUFG said.
Uncertainty over U.S. debt also weighed on prices.
Some progress had been made but several issues remained unresolved in U.S. debt ceiling negotiations, House Speaker Kevin McCarthy said on Thursday, as the deadline ticked closer to raise the federal government’s $31.4 trillion borrowing limit or risk default.
Negotiators for Democratic President Joe Biden and top congressional Republican Kevin McCarthy reconvened Wednesday at the White House to try to close a deal.
Meanwhile, price declines were limited by an unexpected, massive fall in U.S. crude oil inventories in the week to May 19 reported by the Energy Information Administration on Wednesday.
U.S. crude inventories fell by 12.5 million barrels to 455.2 million barrels as imports declined. Analysts had expected an 800,000-barrel rise. [EIA/S]
Gasoline inventories dropped by 2.1 million barrels in the week to 216.3 million barrels, the EIA said, while distillate stockpiles fell by 600,000 barrels to 105.7 million barrels.
(Additional reporting by Jeslyn Lerh in SingaporeEditing by Mark Potter)
OPEC, or the Organization of the Petroleum Exporting Countries, is a group of oil-producing nations that coordinates policies to manage oil production and prices.
Brent crude oil is a major trading classification of crude oil originating from the North Sea, used as a benchmark for pricing oil worldwide.
West Texas Intermediate (WTI) is a grade of crude oil used as a benchmark in oil pricing, primarily sourced from the U.S. and known for its light and sweet characteristics.
Crude oil inventory refers to the amount of crude oil stored in tanks and reserves, which is monitored to gauge supply and demand in the market.
A production cut in oil markets refers to a decision by oil-producing countries to reduce the amount of oil they produce, aimed at stabilizing or increasing prices.
Explore more articles in the Top Stories category
