West Texas Intermediate (WTI) crude oil futures on the NYMEX dipped over 1% to around $62.00 during European trading hours on Friday, falling to the lower end of the weekly trading range. The decline comes as investors begin to price in the potential impact of a significant production increase by OPEC+ members in the near term.
OPEC+ to Boost Oil Output Significantly
Recent reports pointing to a substantial increase in oil production from OPEC+ have weighed heavily on oil prices. According to Reuters, OPEC+ plans to raise its output by 411,000 barrels per day (bpd) from May onwards—three times the 138,000 bpd increase originally planned. This larger-than-expected boost in supply has added downward pressure to oil prices as markets adjust to the prospect of a supply surplus.
OPEC+ Members Push for National Interests
Statements from several OPEC+ members, including Kazakhstan, have further compounded concerns. Kazakhstan’s energy minister told Reuters that the country would not restrict output from independent oil producers on its territory. Additionally, Kazakhstan emphasized that it would not shut down its own oil fields, as doing so would harm future production capabilities. These comments highlight a shift toward prioritizing national interests over collective OPEC+ goals.
US-China Trade Talks Add Uncertainty to Oil Demand Outlook
Compounding the supply concerns, geopolitical uncertainty surrounding US-China trade talks has once again cast a shadow over the oil demand outlook. Earlier this week, US President Donald Trump expressed optimism about the trade negotiations, stating that “discussions with Beijing are going well” and that a deal could be reached soon. However, China quickly refuted these claims, with a spokesperson from the Chinese Ministry of Commerce clarifying that no “economic and trade negotiations” had taken place between the two nations. Furthermore, China is insisting that the US completely cancel all unilateral tariffs before resuming trade talks, adding to the uncertainty.
