Oil Heading for Biggest Weekly Fall in Months

EghtesadOnline: Oil prices fell on Friday, heading for their biggest weekly drop since at least May as expectations of more supplies spooked investors, with OPEC likely to add output to meet a potential revival in demand as more countries recover from the pandemic.

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17 July 2021

Brent crude for September was down 20 cents at $73.27 a barrel and is heading for a 3% fall this week after two days of heavy declines, the biggest weekly drop since May, Reuters reported.

US crude for August fell 19 cents to $71.46 a barrel, and is on track for a decline of about 4% this week, the largest weekly decline since March.

Discussions on supply policy within the Organization of Petroleum Exporting Countries, Russia and other producers, a group called OPEC+, ended without agreement this month after the UAE objected to extending the output policy beyond April 2022.

Saudi Arabia and the UAE reached a compromise this week, paving the way for OPEC+ to finalize an agreement that would allow more supply into the market.

OPEC said on Thursday it expects world oil demand to increase next year to around levels seen before the pandemic, about 100 million barrels per day, led by demand growth in the United States, China and India. OPEC output in June increased by 590,000 barrels per day to 26.03 million bpd.

A large decline in crude stockpiles in the United States has done little to support prices as a rise in gasoline inventories in a week that included the Fourth of July holiday, when driving usually surges, raised fresh demand concerns.