Oil prices continued to fall after registering close to a 3% decline on Thursday after Russia indicated The Organisation of the Petroleum Exporting Countries and its allies, known as OPEC+, weren’t likely to alter production levels at its next meeting.
Russia’s Deputy Prime Minister Alexander Novak stated OPEC+ wasn’t likely to take further measures at its gathering in Vienna in June, according to a Bloomberg report.
Price Action: West Texas Intermediate futures maturing in July were trading 0.11% lower at $71.77 per barrel during Friday afternoon Asian trading session. The United States Brent Oil Fund BNO closed 2.25% lower on Thursday while the Vanguard Energy Index Fund ETF VDE lost 1.89%. Oil prices have been on a downward trend since mid-April and have not been able to breach the $80 per barrel mark on the upside.
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Novak’s remarks stood in contrast to warnings from Saudi Energy Minister Prince Abdulaziz bin Salman’s earlier during the week.
“I keep advising them that they will be ouching — they did ouch in April,” the Minister cautioned speculators, while speaking at the Qatar Economic Forum in Doha on Tuesday. “I would just tell them: Watch out!” he said. OPEC+ alliance is scheduled to meet June 3-4 in Vienna.
Crude oil has lost over 10% this year as downbeat economic recovery in top importer China and an aggressive monetary policy action by the Federal Reserve put pressure on the prices.
Outlook: James Whistler, Managing Director at Vanir Global Markets Pte told Bloomberg, while referring to the comments from Russia, oil lost recent gains amid OPEC’s reluctance to cut production further. “We see things softening a bit further from here as cautious sentiment permeates the markets,” he said.
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