WTI tumbles to near $62.00 on OPEC’s supply increase, potential demand concerns
- WTI plummets sharply to near $62.00 as OPEC+ is likely to increase oil production over three times from May onwards.
- Kazakhstan stated that the Oil production under quotas is impacting its fields.
- China denies of having any trade negotiations with the US.
West Texas Intermediate (WTI), futures on NYMEX, is down over 1% to near $62.00 during European trading hours on Friday. The Oil price is down to near the lower end of the weekly range as investors start discounting the impact of a significant increase in production by OPEC+ members in the near-term.
Latest reports pointing to a substantial increase in the Oil production over planned increments have weighed heavily on the Oil price. Reports from Reuters have shown that the OPEC+ will increase its output by 411,000 million barrels per day (bpd) from May onwards, three times more against 138K bpd as planned.
Statements from some of OPEC+ members, including Kazakhstan, that capacity underutilization is harming their oil fields have led them to prioritize their national interest group’s objectives.
Kazakh energy minister told Reuters on Wednesday the country was unable to curtail the output of independent oil majors on its territory and would not shut down its own oilfields as that would damage their future production.
Meanwhile, Beijing’s denial to any news stating discussions between China and Washington over trade deal has stoked uncertainty over the oil demand outlook again. This week, United States (US) President Donald Trump stated that “discussions with Beijing are going well” and added that he thinks “they will reach a deal”.
However, China clarified that there has not been any “economic and trade negotiations between China and the US,” a spokesperson from Chinese ministry said on Thursday. Additionally, China wants the US to “completely cancel all unilateral tariff measures” if it wants trade talks.
