West Texas Intermediate gained 2.8% to settle near $63 a barrel after the Organization of the Petroleum Exporting Countries and its allies agreed on Saturday to add 411,000 bpd of supply in July though some members objected, including Russia. With a handful of countries lobbying for a pause in July, banks are now split on how many more hikes will come in subsequent months.
The total number of active drilling rigs for oil and gas in the United States fell yet again this week, according to new data that Baker Hughes published on Friday, following a 10-rig decrease last week, and a 6-rig decrease the week before that.
Crude oil prices are set for another weekly decline following news that OPEC+ was planning to boost production by another 411,000 barrels daily in July. Meanwhile, a court ruling that blocked Trump’s tariffs has been paused after the White House appealed the decision.
Crude briefly flipped to positive earlier in the session after CNN said fresh penalties on Moscow may be announced in the coming days, potentially bolstering the risks to crude supplies in one of the world’s largest producers. US President Donald Trump said he’s considering new sanctions against Russia after large drone attacks on Ukraine in recent days.
The reason for these expectations is the decision by OPEC+ to keep returning supply to the market. OPEC+ is meeting later today and most observers appear to have assumed it will announce yet another monthly hike of 411,000 barrels daily for July. It is this expected hike that, according to the Reuters refining sources, will drive lower prices for Saudi oil.
“Crude oil edged lower as the market contemplated the outlook for rising OPEC supply,” ANZ analysts said earlier today in a note, as quoted by Reuters. On the other hand, ING analysts noted President Trump’s concession to the EU, which delayed the entry into effect of 50% tariffs to early July in case the two failed to seal a new trade deal. Also on the bullish side, President Trump threatened Russia with more sanctions after intensified strikes on Ukraine that followed a large-scale Ukrainian attack on Russian territory.
First, Jubilee and TEN, where the partners are Tullow, Kosmos, Petro SA, Explorco and GNPC. They have recently announced that they are committed to invest $2billion, to drill up to 20 wells between now and 2040. They are starting the drilling campaign this month with two wells using the Noble Venturer drillship and between four to six wells in 2026.
A European official attending the G7 finance powwow in Banff, Canada, told Reuters that the U.S. Treasury team thinks market forces are already doing the heavy lifting. With Brent prices wobbling around $64—and Russia’s Urals blend clocking in at a $10 discount—Washington’s logic is that there’s no need to poke the bear when the bear’s already limping.
The UK urged its Group of Seven allies to agree a cut to the price cap on Russian oil, saying the move is necessary to put further pressure on President Vladimir Putin to end Russia’s war in Ukraine.
While oil markets have calmed somewhat at the start of this week after a period of intense volatility, developments in either Ukraine or Iran might soon spark another significant move.