Oil slumps amid talk of reviving output
Brent futures that traded above $80 a barrel last week slumped near $75 in London yesterday
Saudi Arabia and Russia signalled they’ll restore some of the output they halted as part of a deal between Opec and its allies, in a move to ease consumer fears |
Brent crude headed for its longest run of losses in almost four months as Saudi Arabia and Russia said they are discussing reviving output to ease consumer anxiety after prices jumped to levels last seen in 2014.
Brent futures that traded above $80 (Dh294) a barrel last week slumped near $75 in London yesterday, while crude in New York dropped 3.1 per cent.
Saudi Arabia and Russia signalled they’ll restore some of the output they halted as part of a deal between Opec and its allies that went into effect in January last year. Still, with opposition from several producers, it’s not clear whether the group will reach a consensus when it meets in Vienna next month.
Oil earlier in May rose to a three-and-a-half-year high after US President Donald Trump decided to renew sanctions on Iran and as plunging Venezuelan output fuelled concerns over disruptions.
With the Organisation of Petroleum Exporting Countries (Opec) and its partners said to have cleared a market surplus despite record American production, traders now are weighing whether Saudi Arabia and Russia will implement their plan without finding a compromise with allies.
“The latest signal from Opec and Russia cooled down expectations
DME Oman Crude —
Spot Gold for the group’s cuts, which have been a major factor boosting crude prices since late last year,” Satoru Yoshida, a commodity analyst at Rakuten Securities Inc, said by phone from Tokyo.
“If Opec and allies decide at the June meeting to maintain their production cuts through December and ease anxiety among investors, crude prices may rebound.”
West Texas Intermediate for July delivery fell as much as –0.24%
UAE 24 ct Gold/10g –0.16% $2.08 to $65.80 a barrel on the New York Mercantile Exchange and traded at $66.79 at 3.55pm in Tokyo. There is no settlement Monday because of the US Memorial Day holiday.
Trades will be booked today for settlement purposes. Prices dropped $2.83 to $67.88 on Friday, the biggest loss since July 5. Total volume traded was about 109 per cent above the 100-day average. UAE 22 ct Gold/10g –0.17%