Oil prices fall ahead of OPEC+ meeting
Oil prices fell on Wednesday ahead of an OPEC+ producers’ meeting in which producers are expected to hold production steady with limited spare capacity and amid fears that a slowdown in global growth will affect fuel demand.
Brent crude futures were down $1.34, or 1.3%, at $99.20 a barrel at 0815 GMT. West Texas Intermediate (WTI) crude futures fell $1.28, or 1.4%, to $93.14 a barrel.
The first-month Brent futures premium to six-month barrel loading is at its lowest level in three months, indicating concerns about current supply are fading.
Ministers from members of the Organization of Petroleum Exporting and Allied Countries, including Russia, known as OPEC+, meet on Wednesday from 11:30 GMT.
OPEC+ sources told Reuters last week that the group would likely keep output unchanged in September, or increase it slightly.
Saudi Arabia may be reluctant to increase production at the expense of sanctions-hit OPEC+ partner Russia over the Ukraine conflict.
“Even if the OPEC+ group were to declare a small increase, the gesture would be largely symbolic given that very few members have the capacity to materially increase production,” said PVM analyst Stephen Brennock.
“Either way, OPEC will be wary of rocking the boat given the current volatile and turbulent state of the oil market.”
Ahead of the meeting, OPEC+ cut its forecast for an oil market surplus this year by 200,000 barrels per day (bpd), to 800,000 bpd, three delegates told Reuters.
Meanwhile, data from the American Petroleum Institute, an industry group, showed U.S. crude inventories rose about 2.2 million barrels for the week ended July 29. Gasoline inventories fell by 200,000 barrels and distillate inventories by about 350,000 barrels.
Official data from the US Energy Information Administration (EIA) is expected at 2:30 p.m. GMT.