Brent crude oil futures fell 80 cents (1.2%) to $67.50 a barrel (about S$86.17); West Texas Intermediate crude oil (WTI) fell $1.32 (2%) to $65.68 a barrel. OPEC+ announced on July 5 that it would increase its daily output growth to 548,000 barrels in August, far higher than the previous level of 411,000 barrels per day from May to July and 138,000 barrels per day from April. OPEC+ said that the stable global economic outlook, good market fundamentals and low crude oil inventories are the main reasons for the decision to increase supply.
Goldman Sachs analysts expect OPEC+ to announce a daily increase of 550,000 barrels in September at its next meeting on August 3.
International oil prices fell more than 1% on Monday (July 7), as OPEC+, a group of non-member countries, announced last Saturday (5th) that crude oil production in August would increase beyond expectations, causing market concerns about oversupply.
In addition, US President Trump said on Sunday that the United States will finalize a number of trade agreements in the next few days and will notify countries to raise tariff rates before July 9, and the relevant measures are expected to take effect on August 1.
Saudi Arabia announced on Sunday (6th) that it would raise the price of Arab light crude oil for the Asian market in August, a four-month high.
A team of analysts at RBC Capital said that eight OPEC members voluntarily reduced production by 2.2 million barrels per day, and this increase will bring nearly 80% of these oil production back to the market. However, the actual increase in production so far has been lower than expected, with most of the new supply coming from Saudi Arabia.