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Phil Flynn, senior analyst at Price Futures group: There seems to be some profit-taking in the oil market due to concerns that OPEC will increase production by more than expected.July 5, Swissquote senior market analyst Ipek Ozkardeskaya: The preference for the US dollar is weakening. First, concerns about US debt are rising, and second, the preference for US debt is facing risks. Another reason is that the tariff situation and trade disruptions will have a negative impact on US economic growth, and the Federal Reserve may not be able to support the economy when inflation risks rise.July 5th news: On July 4th local time, a federal judge in the United States briefly halted the Trump administrations plan to deport eight immigrants to South Sudan in order to buy time for their lawyers to state their claims in a Massachusetts court.On July 5, institutional analyst Javier Blas said that OPEC+ representatives are discussing a fourth consecutive increase of 411,000 barrels per day, but there is also the possibility of a "slightly larger" increase. According to the increased UAE quota, OPEC+ will return about 2.5 million barrels per day of production to the market. So far, about 1.4 million barrels per day have been returned (one increase of 138,000 barrels per day and three increases of 411,000 barrels per day). Next, the remaining increase may be divided into three monthly increases (two 411,000 barrels per day and one about 275,000 barrels per day). But it is also possible to accelerate the increase in production and make two increases of about 550,000 barrels per day.French President Emmanuel Macron: Airbus and Malaysia Airlines have reached a "historic" cooperation agreement. (Previously, AirAsia Bhd. reached a preliminary agreement with Airbus to purchase up to 70 Airbus SE extended-range jets, a transaction valued at $12.3 billion.)

Oil prices fall ahead of an OPEC+ summit

Charlie Brooks

Aug 01, 2022 10:58

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As investors prepared for this week's meeting of OPEC and other major producers to discuss supply modifications, oil prices declined on Monday morning.


At 0000 GMT, Brent oil futures declined 63 cents, or 0.6 percent , to $103.34 a barrel. U.S. West Texas Intermediate oil was trading at $97.87 per barrel, a decrease of 75 cents or 0.7%, after hitting a session low of $97.55 when trading in Asia began.


The price of both futures contracts climbed by more than $2 a barrel on Friday, as the risk appetite of investors grew. However, both Brent and WTI ended July with a second consecutive monthly decline for the first time since 2020, as rising costs and interest rates fueled concerns that a recession would restrict gasoline use.


According to ANZ analysts, gasoline use is below the five-year average for this time of year and fuel sales to British motorists are dropping. In reaction, for the first time since April, experts polled by Reuters cut their projections for the average Brent price in 2022 to $105.75 per barrel and for WTI to $101.28 per barrel.


Organization of Petroleum Exporting Countries (OPEC) and its allies, including Russia, will meet on Wednesday to set September production.


Two of eight OPEC+ sources questioned by Reuters said that a slight increase for September would be discussed at the August 3 meeting, while the other six sources indicated that output will likely stay constant.


The meeting follows Vice President Joe Biden's visit to Saudi Arabia last month.


While President Biden's visit to Saudi Arabia did not result in immediate oil shipments, Helima Croft, an analyst at RBC Capital, thinks that the Kingdom will continue to gradually increase output.


In 2020, at the beginnings of the COVID-19 outbreak, OPEC+ has completely reversed the dramatic production restrictions enacted at the start of August.


Sunday, the group's new secretary general, Haitham al-Ghais, emphasized that Russia's participation in OPEC+ is important to the success of the accord, as reported by the Kuwaiti newspaper Alrai.


Baker Hughes reports that the number of oil rigs in the United States climbed by 11 in July, marking the 23rd consecutive month of rise.

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