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On Wednesday, 11 June, oil prices continued to decline amid weak demand from China and rising OPEC+ production.
According to Reuters, in Asian trading, Brent crude oil futures fell by 19 cents (0.3%) to $66.68 per barrel, while WTI fell by 16 cents to $64.82 per barrel.
OPEC+ increases production, China slows demand
The OPEC+ alliance confirmed plans to increase oil production by 411 thousand barrels per day in July, continuing the gradual lifting of restrictions imposed during the pandemic.
Analysts at Capital Economics believe that domestic demand in OPEC+ countries, especially in Saudi Arabia, may temporarily balance the market, but overall demand from China, one of the largest oil importers, remains weak.
The US-China trade truce is still without specifics
Despite a preliminary agreement between the US and China to return to trade dialogue and lift restrictions on the export of rare earth minerals, markets remain cautious. US Secretary of Commerce Howard Luthnick announced a framework agreement, but there has been no official reaction from the White House.
Expectations for US stockpiles
The market is also focused on the release of weekly data on US oil inventories. According to preliminary estimates by the American Petroleum Institute, crude oil stocks fell by 370 thousand barrels, while the Reuters forecast was for a decline of 2 million barrels. Distillate and gasoline stocks are likely to have increased.
Expert forecasts – Brent may fall to $60
Economist Hamad Hussein warns that the increase in demand is a seasonal phenomenon, and prices may go down again towards the end of the year. Capital Economics predicts that Brent could fall to $60 per barrel by December.
