Analysts from “Goldman Sachs” and “JP Morgan” said that the impact of the voluntary production cuts from the “OPEC +” alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, has become felt after entering into force this month.
JPMorgan said the alliance’s total exports of crude and oil products fell by 1.7 million barrels per day by May 16, adding that Russian oil exports would likely drop by late May.
price movements
By 06:34 GMT, Brent crude futures fell by 73 cents, or 0.97 percent, to $ 74.85 a barrel, and US West Texas crude for July delivery, the most traded futures contract, fell by 73 cents, or 1.02 percent, to $70.96.
West Texas crude futures for June, which expires later on Monday, fell 87 cents to $70.68 a barrel.
“I expect a lot of volatility in the coming days and a recovery in crude prices when an agreement is reached to raise the debt ceiling,” said Vandana Hari, founder of oil market analysis Vanda Insights.
She added, “But the room for oil to rise after that will be limited, with the return of unfavorable economic conditions to the fore.”
Analysts said reports of weak economic data from China in the past few weeks had raised concerns about demand in the world’s largest oil importer and second-largest oil consumer.
The two crudes rose last week about 2 percent, in their first weekly gain in five weeks, after forest fires in Alberta, Canada, disrupted large quantities of crude oil supplies.
On Saturday, the G7 countries pledged at the annual meeting of their leaders to strengthen efforts to confront Moscow’s circumvention of the Russian oil price cap, “in parallel with avoiding spillover effects and preserving global energy supplies,” without elaborating.
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