Oil Extends Losses as Focus Shifts to OPEC Hikes, Tariffs
7/16 8:53 AM
Oil Extends Losses as Focus Shifts to OPEC Hikes, Tariffs
Karim Bastati
DTN Analyst
VIENNA (DTN) -- Oil prices slid for a third day Wednesday morning as fears
of near-term supply disruptions gave way to concerns over a looming supply glut
later this year. The anticipated return of higher tariffs starting August 1 is
likely to stymie demand growth at a time when OPEC's production hikes have
considerably picked up the pace.
NYMEX-traded WTI for August delivery fell $0.59 to trade near $65.93 bbl,
and ICE Brent for September delivery slid $0.51 bbl to $68.20 bbl.
August RBOB gasoline futures softened $0.0146 to $2.1550 gallon, and the
front-month ULSD futures contract retreated $0.0116 to trade near $2.3936
gallon.
The U.S. dollar index gained 0.140 points to 98.450.
With the prospect of immediate additional sanctions on Russian energy trade
waning following U.S. President Trump granting Russia a 50-day grace period,
market participants are focusing on a looming oil glut this year. According to
OPEC's monthly oil market report released Tuesday, the organization is
unwinding production cuts at the fastest pace so far. OPEC crude oil production
rose 220,000 bpd in June despite a drop in Libyan and Iranian output. Members
of the declaration of cooperation, colloquially known as OPEC+, raised output
by a combined 349,000 bpd from May. The eight member countries who have since
2023 shouldered an additional 2.2 million bpd in voluntary adjustments ramped
up production by 395,000 bpd, close to in line with their 411,000 bpd target.
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