World oil prices fall despite OPEC+ production cuts

World oil prices fell early on June 3, despite the move by the Organization of the Petroleum Exporting Countries (OPEC+, including OPEC and Russia) to extend deep production cuts until 2025.

Brent crude for August delivery fell 24 cents to $80.87 a barrel, or 0.3 percent, according to Reuters. US West Texas Intermediate (WTI) crude for July delivery fell 19 cents to $76.80, or 0.25 percent.

OPEC+ is currently cutting a total of 5.86 million barrels per day, equivalent to about 5.7% of global demand, including a cut of 3.66 million barrels per day (expiring at the end of 2024) and a voluntary cut by 8 members of 2.2 million barrels per day (expiring at the end of June 2024).

But on June 2, the group agreed to extend the 3.66 million barrels per day cut for another year, until the end of 2025. At the same time, it will extend the 2.2 million barrels per day cut for another three months, until the end of September 2024. The countries implementing the second voluntary cut are Algeria, Iraq, Kazakhstan, Kuwait, Oman, Russia, Saudi Arabia, the United Arab Emirates (UAE) and Gabon.

The decision comes as oil prices trade near $80 a barrel, well below the level many OPEC+ members need to balance their budgets. Analysts say the ongoing conflict in many places and China’s economic growth that has yet to meet expectations are the two main reasons for OPEC+ to cut production.

HUY QUOC

Source: https://www.sggp.org.vn/gia-dau-the-gioi-giam-bat-chap-opec-cat-giam-san-luong-post742714.html