Oil prices extend losses on expected supply increase
Oil prices fell on Thursday, extending losses as investors braced for increased supplies after a compromise deal between leading OPEC producers and as U.S. fuel stocks rose, raising concerns over demand in the world’s largest consumer.
Brent crude dipped 1.73% to settle at $73.47 per barrel and U.S. West Texas Intermediate (WTI) crude finished 2.02% lower at $71.65 per barrel.
Both benchmarks slid more than 2% on Wednesday after Reuters reported that Saudi Arabia and the United Arab Emirates (UAE) had reached a compromise that should pave the way for a deal to supply more crude to a tight oil market and cool soaring prices.
Talks among the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, a group known as OPEC+, had broken down this month after the UAE objected to an extension to the group’s supply pact beyond April 2022.
However, analysts at Goldman Sachs, Citi and UBS expect supplies to remain tight in the coming months even if OPEC+ finalises an agreement to raise output.
Reference: CNBC
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