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Oil steady as markets await OPEC+ meeting


The Brent crude July contract was 24 cents higher to $82.36 a barrel, and the more-active August contract gained 29 cents to $82.13

Oil prices steadied in Asian trading on Monday as markets awaited an OPEC+ meeting on June 2 where producers are expected to discuss maintaining voluntary output cuts for the rest of the year.

The Brent crude July contract was 24 cents higher to $82.36 a barrel as of 0638 GMT. The more-active August contract gained 29 cents to $82.13.

U.S. WTI crude futures added 28 cents to $78 per barrel.

Brent ended last week around 2% lower and West Texas Intermediate shed around 3% after Fed minutes showed some officials would be willing to tighten interest rates further if they believed it was necessary to control persistent inflation.

Public holidays in the U.S. and UK on Monday are expected to keep trading relatively thin.

The upcoming meeting of the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, was pushed back by a day and will be held online, OPEC said on Friday.

The producers will discuss whether to extend voluntary output cuts of 2.2 million bpd into the second half of 2024, with sources from OPEC+ countries saying an extension was likely.

Oil futures are expected to maintain today’s gains due to expectations of the cuts being extended, according to Sugandha Sachdeva, founder of SS WealthStreet.

However, the trajectory of price action will be considerably influenced by the U.S. PPI data scheduled for the week, which will in turn shape the Fed’s approach to potential rate adjustments, Sachdeva added.

Along with another 3.66 million barrels per day of production cuts valid through the end of the year, the output cuts are equivalent to around 6% of global oil demand.

OPEC has said it expects another year of relatively strong growth in oil demand of 2.25 million barrels per day, while the International Energy Agency (IEA) expects much slower growth of 1.2 million bpd.

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