Oil prices were roughly unchanged in early trading today, as markets awaited clarity on OPEC and its allies’ next oil policy moves after conflicting messages made it hard to predict the outcome of the meeting next week.
Brent crude slipped 4 cents to $76.22 a barrel this morning, while U.S. West Texas Intermediate was up 9 cents, or 0.1 per cent, at $71.92 a barrel.
Benchmarks had settled more than $2 per barrel lower yesterday, after Russian Deputy Prime Minister Alexander Novak played down the prospect of further OPEC+ production cuts at its meeting in Vienna on June 4.
Russian President Vladimir Putin said on Wednesday that energy prices were approaching “economically justified” levels, also indicating there could be no immediate change to the group’s production policy.
Their remarks contrasted with comments this week from Saudi Arabian Energy Minister Prince Abdulaziz bin Salman, the de-facto leader of the Organization of Petroleum Exporting Countries (OPEC), warning short sellers to “watch out”.
Some investors interpreted that as a signal OPEC+ could consider further output cuts.
Markets continued to watch U.S. debt talks, as U.S. President Joe Biden and top congressional Republican Kevin McCarthy appeared to be nearing a deal to cut spending and raise the debt ceiling.
Keeping a lid on oil prices, the dollar ticked higher, strengthening for a fifth straight session, against a basket of major peers, as U.S. data pointed to a resilient economy even after an aggressive rate hike cycle by the Federal Reserve.
A stronger greenback makes dollar-denominated commodities more expensive for those holding other currencies, denting demand.
Recent comments from Fed officials have indicated members are divided about whether to keep hiking rates or not, with the probability of a 25 basis point rate hike from the Fed at its June meeting rising.
Source: Reuters
