Oil retreats on forecast Opec will ease supply cuts
Joint ministerial monitoring committee will meet on Tuesday and Wednesday to recommend next level of restrictions
Singapore — Oil slipped in early Asian trade on Monday as traders eyed an Opec technical meeting this week at which a recommendation is expected to ease supply cuts that have been propping up crude prices.
Brent crude had fallen 27c to $42.97 a barrel by 3.14am while US West Texas Intermediate crude was at $40.27 a barrel, down 28c.
Oil was little changed last week as a resurgence of coronavirus cases prompted several US states to impose tighter travel restrictions that could dampen oil demand recovery at the world’s largest consumer.
However, prices rose more than 2% on Friday after an upward revision by the International Energy Agency in its 2020 oil demand by 400,000 barrels per day.
Oil prices have recovered sharply from multidecade lows in April after Opec and allies including Russia, a group known as Opec+, cut output by a record 9.7-million barrels per day for three months since May.
Opec’s joint ministerial monitoring committee (JMMC) will meet on Tuesday and Wednesday to recommend the next level of cuts.
Opec and Russia were expected to ease their supply cuts as global oil demand has recovered and prices have bounced back.
“The planned easing of Opec+ production cuts next month … and a potential rebound in US production could add pressure on the supply side of the equation,” Stephen Innes, chief global markets strategist at AxiCorp, said in a note.
Libya exported its first crude cargo in six months on Friday after a blockade by eastern forces, but then reimposed force majeure on all oil exports on Sunday.
Its National Oil Corp accused the United Arab Emirates of instructing the eastern forces in Libya’s civil war to reimpose the blockade.
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