Oil prices that OPEC+ plans to accelerate production have slipped

August WTI Crude Oil (CLQ25) closed -0.41 (-0.63%) on Monday, and August RBOB petrol (RBQ25) closed +0.27 (+0.13%).

The prices of crude and gasoline on Monday were mixed. Crude was under pressure on Monday, due to expectations of an additional 411,000 bpd increase when OPEC+ meets on Sunday. Comments from President Trump also weighed on oil prices when he said Iran’s sanctions relief might support the relief “if it’s peace.”

Crude oil losses were restricted on Monday after the dollar index (DXY00) fell to a 3-1/4 year low. Also, Monday’s rally to the new record at the S&P 500 shows confidence in the economic outlook in favor of energy demand and oil prices.

Concerns about global oil overloads are negative about gross prices. Last Wednesday, Russia said the group is open to another production hike for OPEC+ crude oil production in August, where it meets this Sunday. On May 31, OPEC+ agreed to raise 411,000 bpd crude oil production in July after raising its output by the same amount in June. Saudi Arabia shows that an increase in the size of additional crude production, which could continue, is seen as a strategy to lower crude oil prices and punish overproduction OPEC+ members such as Kazakhstan and Iraq. OPEC+ is increasing its output to reverse its two-year production cuts, gradually recovering production of 2.2 million bpd. OPEC+ previously planned to restore production between January 2025 and the second half of 2025. However, production cuts will not fully recover until September 2026. OPEC could raise production to +200,000 bpd to 27.54 million bpd.

The weakening of US economic news is negative for energy demand and oil prices. The Jun MNI Chicago PMI report on Monday unexpectedly fell from -0.1 to 40.4, weaker than the weakest report in five months with expectations of an increase to 43.0. Additionally, the Dallas Fed Manufacturing Outlook Survey in June was weaker than expected for -10.0, up from -12.7 to -12.7.

Gasoline prices are supported by the record forecast (AAA) of 61.6 million people travelling by car on July 4 (June 28 to July 6).