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Oil Prices Modestly Lower as Traders Look Ahead at Potential Supply Hike

Published 15/06/2018, 09:41
© Reuters.  Oil inched lower on Friday.
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Investing.com - Oil prices inched down on Friday after Saudi Arabia and Russia indicated that OPEC could vote to increase oil production at its meeting next week.

Crude oil futures decreased 0.24% to $66.73 a barrel as of 4:40 AM ET (8:40 GMT). Meanwhile Brent crude futures, the benchmark for oil prices outside the U.S., slumped 0.65% to $75.45.

The Organization of the Petroleum Exporting Countries and Russia countries is set to meet in Vienna on June 22 and is expected to decide whether or not to increase supply by one million barrels per day, as OPEC faces losses from Venezuela and Iran.

Total production of OPEC countries rose by 35,000 barrels per day (bpd) in May to 31.87 million bpd, according to its monthly report.

OPEC has been cutting crude output by 1.8 million bpd to prop up oil prices. The pact began in January 2017 and is set to expire at the end of 2018.

After a meeting with the Saudi Arabia energy minister on Thursday, Russian Energy Minister Alexander Novak said that both of the countries agreed that production levels should increase.

“We in general support this ... but specifics we will discuss with the ministers in a week,” Novak said.

The two countries are the biggest producers of oil in OPEC.

Meanwhile traders are looking ahead to the weekingly Baker Hughes oil rig count for any indication of increasing U.S. supply.

Inventories of U.S. Crude Oil Inventories fell by 4.143 million barrels for the week ended June 8, well above expectations for a draw of 1.440 million barrels, according to data from the Energy Information Administration (EIA) on Wednesday.

In other energy trading, Gasoline RBOB Futures decreased 0.60% at $2.0790 a gallon, while heating oil fell 0.79% to $2.1417 a gallon. Natural gas futures was up 0.81 to $2.989 per million British thermal units.

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