U.S. crude prices fell 1 percent Friday in a sudden move after a report said supply from OPEC is rising.
Reuters said OPEC’s July oil supply was set to rise by 145,000 barrels per day (bpd) compared to June, citing PetroLogistics, a company that tracks OPEC supply forecasts.The increase in oil supply would push production above 33 million barrels per day.
West Texas Intermediate futures erased earlier gains on the report, trading at $46.52 per barrel.
WTI intraday chart
The move took place as investors braced for a key meeting between OPEC and non-OPEC members next week.
“We’re keying on everything ahead of the OPEC meeting,” said John Kilduff, founding partner of Again Capital. “They can’t add even a barrel right now.”
The oil-producing countries will meet to discuss compliance of agreed production cuts and how to bring down inventory levels.
That said, they face increasing uncertainty after Ecuador said it will start to increase production again due to revenue reasons, said Helima Croft, global head of commodity strategy at RBC Capital Markets.
“Ecuador’s move underscores the sharp divergence in the economic fortunes of the sovereign
producers, with the most cash strapped states in urgent need of financial relief and the flusher
nations having the time, and perhaps even the incentive, to let the current cut run its course,” Croft said in a Thursday note.