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Crude oil futures fell slightly on Tuesday after news reports said Russian Deputy Prime Minister Alexander Novak indicated that OPEC+ may increase production if market conditions warrant it, in addition to other signs of easing supply concerns.
“It always depends “The current situation and the balance of supply and demand…we need to look at how the market feels,” Interfax quoted Novak as saying.
OPEC+ is expected to extend the current voluntary cuts of 2.2 million barrels per day after the second quarter, and the organization is expected to make a decision on production levels at its meeting on June 1.
Carsten Fritsche of Commerzbank says one of the obstacles facing OPEC may be… Insufficient implementation Among the cuts agreed upon by some countries such as Iraq and Kazakhstan, which he said significantly exceeded their production targets in the first quarter, although both countries presented plans outlining how they plan to make up for surplus production by the end of the year.
In its latest form Short-term energy forecastThe US Energy Information Administration raised its forecast for global production of oil and liquid fuels this year and lowered its forecast for demand. Pointing to a well-supplied market Contrary to previous forecasts that showed a shortage in supply.
The report also noted that despite tensions in the Middle East, price fluctuations have been “subdued” for most of this year thanks to “significant” spare crude oil production capacity.
Nymex crude (CL1:COM) for June delivery was flat -0.1% To $78.38 a barrel, its sixth decline in seven sessions, July Brent crude (CO1:COM) closed -0.2% To $83.16 per barrel.
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The Biden administration is back It is seeking bids to replenish the Strategic Petroleum Reserve With oil prices falling below the $79 per barrel ceiling it set itself for renewal, announcing orders on Tuesday for deliveries of up to 3.3 million barrels in October.
In April, the Energy Department canceled planned purchases of 1.5 million barrels each for August and September when prices jumped above the ceiling.
Its strategic reserve stocks An increase in each of the past six months The Department of Energy continued its efforts to replenish inventory, purchasing 32.3 million barrels of oil at an average price of $76.98 per barrel, and expediting nearly 4 million barrels of exchange revenue.
Despite the additions, levels in the reserve remain near all-time lows at levels equal to those seen in October 1983.