Oil prices dropped for a fourth consecutive session on Friday and were set for their first weekly decline in three weeks, weighed down by renewed supply pressure from another possible OPEC+ output hike in July.
Brent futures fell 31 cents, or 0.5%, to $64.13 a barrel by 0412 GMT. U.S. West Texas Intermediate crude futures lost 33 cents, or 0.5%, to $60.87.
For the week, Brent has fallen 1.9%, and WTI has dropped 2.5%, following two weeks of gains.
Both contracts touched their lowest in more than one week on Thursday after a Bloomberg News report that OPEC+ was considering another large production increase at a meeting on June 1.
Increasing output by 411,000 barrels a day (bpd) for July was among the options discussed, but no final agreement has yet been reached, the report said, citing delegates.
“The oil market is under renewed pressure as noise builds around what OPEC+ will do with their July output levels,” ING analysts wrote in a research note.
They expect that OPEC+ will go ahead with a 411,000 bpd supply increase for July and currently forecast Brent to average $59 per barrel in the fourth quarter.
OPEC+, which includes the Organization of the Petroleum Exporting Countries and allies such as Russia, agreed to increase production by nearly 1 million barrels per day (bpd) in April, May and June.
The supply tailwind offset jitters earlier this week triggered by a report saying Israel is making preparations to strike Iranian nuclear facilities and new sanctions announced by the EU and Britain on Russia’s oil trade.
A large crude oil build in the U.S. also weighed on oil prices.
As traders brace for a flood of increased supply in coming months from OPEC+, U.S. crude oil storage demand has surged in recent weeks to levels similar to the COVID-19 pandemic, according to data from storage broker The Tank Tiger.
On Friday, the market will watch for U.S. oil and gas rig count data from Baker Hughes that is used as an indicator for future supply.
The market is also closely watching U.S.-Iranian nuclear negotiations which could determine the future supply of Iranian oil. The fifth round of talks will take place in Rome on Friday.
(Reporting by Siyi Liu in Singapore and Laila Kearney in New York; Editing by Tom Hogue and Sonali Paul)