West Texas crude oil contract (WTI) New York market closed down more than 3% last night (8 June) because investors are concerned with news reports that Saudi Arabia announced an increase in oil production in July. In addition, investors are also disappointed that the oil exporting countries (OPEC) and the allies. Or OPEC Plus With a resolution to extend the period to reduce oil production to one month
WTI Crude Oil for July delivery A drop of 1.36 dollars, or 3.4 percent, to close at 38.19 dollars / barrel.
Brent crude oil contract for delivery in August. Down $ 1.50 or 3.6% to close at 40.80 dollars / barrel.
Crude oil contracts closed down. After Prince Abdulaziz bin Salman, Saudi Arabia’s energy minister, said Saudi Arabia will increase oil production in July to be in line with the country’s oil production quota. After ago Saudi Arabia has voluntarily lowered production capacity beyond the agreed Causing the oil production volume of Saudi Arabia to be lower than the quota allowed
In June, Saudi Arabia, Kuwait and the United Arab Emirates. Has promised to reduce the production capacity by 1.18 million barrels / day In addition to the agreement to cut oil production capacity of 9.7 million barrels / day of OPEC Plus Saudi Arabia reduced production by 1 million barrels per day.
Prince Abdoulazis said Such additional capacity cuts will not occur in July. In which Saudi Arabia will produce oil in accordance with the quota Amid signs of recovery of world oil demand
In addition, the crude oil contract fell because investors were disappointed that the OPEC Plus group has resolved to extend the time to cut oil production to just one month. The OPEC Plus Group reached an agreement to extend the time to reduce the production capacity of 9.7 million barrels per day until July. From the original which is scheduled to end in June
OCBC, an analyst with OCBC, said the deal was wrong from the market’s expectation that OPEC Plus would have a resolution to extend production cuts by another 3 months or until September.
In addition, violations of oil production quota from OPEC member countries Especially Iraq and Nigeria Including reports that oil output from Libya will return to the market Is another reason that pressures oil prices
Investors keep an eye on US weekly oil stock reports. The United States Energy Information Administration (EIA) is scheduled to disclose the data tomorrow at 9:30 pm Thai time.