FX.co ★ Oil Slips as OPEC+ Ramps Up Production

On Monday, West Texas Intermediate (WTI) crude oil futures declined by over 1%, nearing the $65 per barrel mark, furthering last week’s downward trend. This comes in the wake of OPEC+’s decision to enhance their production levels. The organization approved an output increase of 548,000 barrels per day (bpd) for August, a step up from prior monthly increments of 411,000 bpd. This decision intends to reintegrate almost 80% of the previously voluntary 2.2 million bpd cuts from eight OPEC producers back into the market. However, the actual boost in production has so far been slower than anticipated, with the bulk of the increased supply originating from Saudi Arabia. An additional rise of 411,000 bpd had already been widely anticipated for August. Additionally, Saudi Arabia has elevated the price of its key Arab Light crude for Asian markets to the highest level in four months. Contributing to the negative market sentiment, investors are still weighing the prospective effects of US tariffs on global fuel consumption. President Trump announced that the US is nearing the conclusion of several trade agreements and plans to inform other countries about increased tariff rates by July 9, with the new tariffs set to commence on August 1.