Oil Heads for Weekly Decline Ahead of OPEC+ Meeting on Supply

By Bloomberg

Jun 02, 2023

image is BloomburgMedia_RVIHQBT1UM0W01_02-06-2023_06-00-09_638212608000000000.jpg

An oil pump jack at the New Harmony Oil Field in Grayville, Illinois, US, on Sunday, June 19, 2022. Top Biden administration officials are weighing limits on exports of fuel as the White House struggles to contain gasoline prices that have topped $5 per gallon. Photographer: Luke Sharrett/Bloomberg

(Bloomberg) -- Oil headed for its biggest weekly loss in a month as persistent concerns about demand hang over the market ahead of an OPEC+ meeting.

While West Texas Intermediate rose toward $71 a barrel on Friday amid a risk-on tone, futures are still down around 3% for the week. OPEC+ gathers over the weekend to discuss the group’s production policy against the backdrop of a sluggish economic recovery from China, despite the end of Covid Zero.

Most market watchers expect OPEC+ to keep output levels unchanged, although the group did unveil surprise cuts in April and Saudi Arabia’s energy minister recently warned speculators to “watch out.” Crude is down around 13% this year, in part due to resilient crude exports from Russia.

Equity markets across Asia rose on Friday as concerns over further interest-rate hikes from the Federal Reserve eased, while news that Congress had passed legislation to avert a US default added to positive sentiment.

US crude stockpiles rose by about 4.5 million barrels last week, while supplies at the key storage hub at Cushing, Oklahoma, expanded for a sixth week, according to Energy Information Administration data released Thursday.

By Ben Sharples