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Oil prices fell for a second consecutive session on Tuesday, as traders increasingly expect the Organization of the Petroleum Exporting Countries and its allies (OPEC+) to approve a production increase at their upcoming meeting.
Brent crude futures dropped 0.4% to $64.50 a barrel by 05:07 GMT, while U.S. West Texas Intermediate (WTI) crude fell 0.5% to $61.24 a barrel. The WTI contract did not settle on Monday due to the U.S. Memorial Day holiday.
OPEC+ is expected to finalize its July output plan during a ministerial meeting on May 28, with sources indicating a production increase of 411,000 barrels per day is likely.
Additionally, eight OPEC+ members who had pledged voluntary cuts will hold a separate meeting on May 31, one day earlier than initially scheduled. OPEC+ had already accelerated production hikes for June, signaling a gradual easing of earlier supply curbs.
Russian Deputy Prime Minister Alexander Novak said Monday that OPEC+ had not yet discussed a July hike in detail, but the outlook points to a coordinated supply increase.
On the geopolitical front, U.S. President Donald Trump’s decision to delay the implementation of 50% tariffs on the European Union until July 9 offered some relief to markets, reducing immediate concerns that trade tensions could dampen fuel demand.
Meanwhile, Iran set its official selling price for light crude to Asian buyers at a premium of $1.80 a barrel over the Oman/Dubai average for June, up from a $1.65 premium in May.
Iranian President Masoud Pezeshkian commented that Iran would continue to withstand pressure even if ongoing nuclear talks with the U.S. fail to secure a deal.
A breakdown in U.S.-Iran negotiations could mean the continuation of sanctions on Iranian oil exports, limiting supply and potentially supporting prices.
The market remains focused on upcoming OPEC+ decisions, U.S.-Iran nuclear negotiations, and evolving global trade dynamics for further direction.
