- Brent crude fell towards $68 a barrel ahead of an OPEC+ meeting expected to raise output
- OPEC+ may increase production by 411,000 barrels per day in August, triple the initial plan
- US to impose unilateral tariffs from August, with letters sent to trading partners by July 9
Oil fell for a second day in the lead up to an OPEC+ meeting that's expected to deliver another substantial production hike, while President Donald Trump's latest tariff threat dented wider risk appetite.
Brent declined below $68 a barrel after edging 0.4% lower on Thursday. The cartel has begun discussing a fourth, 411,000 barrel-a-day increase for August ahead of a video-conference this weekend, delegates said. The meet has now been moved from Sunday to Saturday.
Global trade policy was also in focus, sending equities in Asia and elsewhere lower. Trump said his administration will begin sending out letters to trading partners to set unilateral tariff rates ahead of a July 9 deadline, and that the new levies will come into force in August.
Oil markets are likely to see thinner trading on Friday because of the Fourth of July holiday in the US. Crude has been volatile in recent weeks, roiled by fears that the Israel-Iran war would hamper supply. While markets have since calmed, apprehension lingers over negotiations with Iran, the US-led trade talks and evolving policy by OPEC+.
“We may see low liquidity and larger price swings than usual, especially as the market remains nervous” ahead of the OPEC+ meeting, said Arne Lohmann Rasmussen, chief analyst at A/S Global Risk Management.
On Iran, Washington plans to restart nuclear talks, and US Middle East envoy Steven Witkoff is set to meet Foreign Minister Abbas Araghchi in Oslo next week, Axios reported. Meanwhile, the US took fresh steps to restrict the trade of the Islamic Republic's oil, keeping up pressure on Tehran.
In Canada, a wildfire emerged in the Fort McMurray area, about 20 kilometers (12 miles) from a major oil-sands production site. Production from Alberta fell to the lowest in two years in May, combining with falling output from Mexico and a ban on Venezuelan flows to strengthen heavy crude prices.
Prices:
Brent for September delivery slipped 1.2% to $67.98 a barrel at 10:36 a.m. in London.
WTI for August delivery fell 1.2% to $66.22 a barrel.
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