Oil prices tumbled more than $2 per barrel in early Asian trading on Monday, following the OPEC+ alliance’s decision to expedite production increases.
By 22:40 GMT, Brent crude futures had fallen by $2.04, or 3.33%, to $59.25 a barrel, while U.S. West Texas Intermediate (WTI) crude dropped $2.10, or 3.60%, to $56.19 per barrel, reports Al-Rai daily.
Both benchmarks reached their lowest levels since April 9 at Monday’s opening, reacting to the OPEC+ agreement to increase oil output for the second consecutive month. The alliance is set to raise production by 411,000 barrels per day (bpd) in June.
This latest hike brings the total increase for April, May, and June to 960,000 bpd, effectively cutting the original 2022 reduction of 2.2 million bpd by 44%, according to Reuters calculations.
“OPEC+’s May 3 decision to raise production quotas by an additional 411,000 bpd for June reinforces market expectations that the global supply-demand balance will shift into surplus,” said Tim Evans, founder of Evans on Energy.
OPEC+ sources told Reuters that the group may fully eliminate voluntary production cuts by the end of October if member countries fail to improve compliance with output quotas.
In response to these developments, Barclays revised its Brent crude price forecast, lowering it by $4 to $66 per barrel for 2025, and by $2 to $60 per barrel for 2026, citing the faster pace of OPEC+’s cut withdrawals, according to analyst Amarpreet Singh.
Kuwait’s Oil Minister reaffirmed the country’s commitment to supporting collective efforts aimed at stabilizing global oil markets, emphasizing the importance of coordination within the OPEC+ framework.
