Crude Oil Prices Settle Higher as Saudi Says Output Hike Will Be Reasonable

Investing.com – WTI crude oil prices settled higher as traders mulled comments from Saudi’s oil minister ahead of the Organization of the Petroleum Exporting Countries meeting next week.

On the New York Mercantile Exchange for July delivery gained 25 cents to settle at $66.89 a barrel, while on London’s Intercontinental Exchange, fell 1.08% to trade at $75.92 a barrel.

Ahead of the Organization of the Petroleum Exporting Countries (OPEC) meeting next week, Saudi Arabian Oil Minister Al Falih reportedly said “it’s inevitable” that OPEC and its allies will agree to boost oil production next week, according to a report from Bloomberg.

Al Falih insisted, however, that the uptick in output would be reasonable and won’t be anything “outlandish.”

Traders remained concerned rising output would slow the rebalancing in oil markets as the production-cut agreement has helped rid the market of excess crude supplies.

In November 2016, OPEC and other producers, including Russia agreed to cut output by 1.8 million barrels per day (bpd) to slash global inventories to the five year-average. The OPEC-led deal was renewed last year through 2018 and is expected to come under review at the oil-cartel’s next meeting on June 22.

The uptick in oil prices comes a day after the Energy Information Administration revealed U.S. supplies fell more than expected but output rose to a record.

Inventories of U.S. crude fell by 4.143 million barrels for the week ended June 8, well above expectations for of 1.440 million barrels, according to data from the Energy Information Administration.

U.S. oil output, meanwhile, continued its expansion rising 0.1m bpd to a record 10.9 million bpd, according to preliminary EIA data, strengthening the United States’ positions as the second largest oil producer behind Russia.

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