Oil Prices Direction Awaits For OPEC+ & US PCE This Week

Oil prices remained steady in early Asian trading on Monday, with the market eagerly anticipating the OPEC+ meeting scheduled for June 2. This meeting holds significant importance as it is expected to address the continuation of voluntary output cuts for the remainder of the year.

USOIL-4 Hour chart

USOIL – 4 Hour chart

The Brent crude July contract inched 11 cents to $82.23 a barrel by 0036 GMT. The more active August contract LCOc2 rose 13 cents to $81.97.

US West Texas Intermediate (WTI) crude futures rose 13 cents to $77.85.

Public holidays in the US and UK on Monday were expected to keep trading relatively thin.

OPEC said on Friday that the upcoming meeting of the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, was pushed back by a day to June 2 and will be held online.

During the upcoming OPEC+ meeting, producers will deliberate on extending voluntary output cuts of 2.2 million barrels per day into the year’s second half. This decision, if implemented, could significantly impact oil prices, with three sources from OPEC+ countries suggesting that an extension is likely.

Combined with another 3.66 million bpd of production cuts valid through the end of the year, the output cuts are equivalent to nearly 6% of global oil demand.

OPEC anticipates another year of robust oil demand growth, projecting an increase of 2.25 million bpd. In contrast, the International Energy Agency is more conservative in its forecast, expecting a slower growth rate of 1.2 million bpd. This projection divergence underscores the market’s uncertainty and the need for careful analysis.

ANZ analysts said in a note that they will be watching gasoline usage as the Northern Hemisphere enters summer, which is traditionally a high season for driving holidays.

In their insightful note, ANZ analysts highlighted the importance of monitoring gasoline usage as the Northern Hemisphere enters summer, a traditionally high season for driving holidays. They also noted the potential impact of improved fuel efficiency and E.V.s on oil demand, which could be offset by rising air travel.

Markets will also watch the US personal consumption expenditures (PCE) index this week for more signals about interest rate policy. The index, due to be released on May 31, is reportedly the US Federal Reserve’s preferred measure of inflation.

Brent ended last week at about 2% lower. WTI lost nearly 3% in the week after meeting minutes from the Federal Reserve, which showed some officials would be willing to tighten interest rates further if they believed it was necessary to control persistent inflation.

The prospect of higher-for-longer interest rates has strengthened the US dollar, making oil more expensive for holders of other currencies.

Recent News
Start Trading Now!

Try our demo account for free to learn trading. When you’re ready, switch to the live account and start trading for real.

Popular posts
ATFX

Account Registration Unavailable

Please note that you may be accessing this page from outside South Africa. For retail and professional inquiries regarding AT Global Markets SA (Pty) Ltd, kindly reach out to us at [email protected]

ATFX

🌍 Welcome to ATFX!

To provide you with the best trading experience in Iraq, please visit our localized website:

There, you’ll find all products, services, and contact information tailored specifically for you. Thank you for choosing ATFX!

ATFX

Restrictions on Use

Products and Services on this website are not suitable for the UK residents. Such information and materials should not be regarded as or constitute a distribution, an offer, or a solicitation to buy or sell any investments. Please visit https://www.atfx.com/en/ to proceed.

ATFX

Restrictions on Use

Products and Services on this website are not available for Hong Kong investors and not related to any corporation licensed by the Securities and Futures Commission in Hong Kong.

All the information and materials posted on this website should not be regarded as or constitute a distribution, an offer, solicitation to buy or sell any investments.

使用限制:本網站的產品及服務不適用於香港投資者及與任何香港證監會持牌公司無關。

網站內部的信息和素材不應被視為分銷,要約,買入或賣出任何投資產品。