Oil prices slump as OPEC+ mulls output cuts
LONDON: Oil prices slid on Monday as the Opec+ group of major crude producers signalled they would start to unwind output cuts later this year, with softer than expected US manufacturing compounding fears of weakening global oil demand.
The concerns pulled stock indices back from earlier highs, seen on the back of hopes that easing inflation could allow the Federal Reserve to cut interest rates later this year.
Oil slipped after Saudi-led OPEC and its Russian-led allies said on Sunday that they would maintain output levels but begin to restore production from October, even as questions about China’s economic recovery and a spike in US stockpiles cause investors to fret over demand.
“This deal looks to draw a line under attempts to drive energy prices sharply higher for the time being,” said Joshua Mahony, chief market analyst at Scope Markets.
Brent, the international benchmark, fell more than two per cent to below $80 a barrel for the first time since February.
Published in Dawn, June 4th, 2024