Oil slipped as the looming prospect of another major OPEC+ production increase overshadowed easing trade tensions between the European Union and the US.
West Texas Intermediate fell 1% to settle below $61 a barrel after a quiet session on Monday due to holidays in London and New York. The dollar advanced, making commodities priced in the currency less attractive.
Oil has trended lower since mid-January as OPEC and its allies have pushed to restore idled supply faster than the market had expected, just as the global trade war threatens demand. Prices have largely stabilized near $61 as traders await the next output move from the cartel, due in the coming days.
The cartel moved up the video-conference that will decide July production levels for eight key OPEC members by one day to May 31, according to delegates with knowledge of the matter. Members held preliminary talks last week on making a large production hike for a third consecutive month.
Crude briefly flipped to positive earlier in the session after CNN said fresh penalties on Moscow may be announced in the coming days, potentially bolstering the risks to crude supplies in one of the world’s largest producers. US President Donald Trump said he’s considering new sanctions against Russia after large drone attacks on Ukraine in recent days.
With geopolitical developments offering a mix of bearish and bullish factors, crude’s decline on Tuesday is mostly due to technical selling driven by short-term strategies from commodity trading advisers, said Rebecca Babin, a senior energy trader at CIBC Private Wealth Group.
Oil has mostly shrugged off Trump’s decision to delay a potential increase in tariffs on the EU after the bloc agreed to accelerate negotiations with the US.
Oil Prices
WTI declined 1% to settle at $60.89 a barrel in New York.
Brent slipped 1% to settle at $64.09 a barrel.
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