Oil prices fall for another session as markets await OPEC+ decision

Oil prices on the New York Mercantile Exchange are falling for a second straight session ahead of the OPEC+ alliance's decision on next month's oil supply quotas. The commodity is trading near its lowest levels since early June, brokers said.

A barrel of West Texas Intermediate crude for delivery on VIII is trading at USD 64.80 on the NYMEX in New York, down 0.48 percent.

Brent on ICE on VIII is trading at USD 66.46 per barrel, down 0.42 percent.

Investors are waiting for the weekend meeting of the OPEC+ alliance countries, during which a decision will be made on the production policy of this group of countries for August.

Key OPEC members and cartel allies are ready to consider a fourth consecutive increase in OPEC+ supplies by 411,000 barrels per day on July 6, OPEC+ delegates to the meeting said.

"The OPEC+ oil production limit increase of 411,000 barrels per day will take place this weekend, and the alliance countries will probably decide in August to increase the limit again," says Robert Rennie, head of commodity and carbon research at Westpac Banking Corp.

"As we enter Q3 and into subsequent quarters, we see increasing downside risks for oil prices and it could soon test the $60 per barrel level," he added.

Oil fell nearly 10% in the second quarter. Those were three volatile months, with oil prices falling sharply in April after U.S. President Donald Trump announced tariffs and rising sharply in June after Israel attacked Iran. Then, the gains were pared as hostilities in the Middle East subsided.

Now, the markets are turning to the fundamentals – oil supply and demand. The achievement (or not) of US trade agreements with its partners and increased oil supplies from OPEC+ are the two most important drivers for oil prices in the near term, analysts point out.

(PAP Business)

aj/ ace/