Oil prices have fallen dramatically, after OPEC+ said the bloc would increase oil output for a second consecutive month.
Brent crude was down 3.62% at 3:05 pm (AEST) at US$59.07 per barrel. West Texas Intermediate crude has dropped by 3.95% to $55.99 per barrel.
OPEC+ agreed yesterday to increase production by an additional 411,000 barrels per day in June.
The bloc said its decision was “in view of the current healthy market fundamentals, as reflected in the low oil inventories, and in accordance with the decision agreed upon on 5 December 2024 to start a gradual and flexible return of the 2.2 million barrels per day voluntary adjustments starting from 1 April 2025.”
OPEC+ nations had previously agreed to boost production in May, and are reportedly seeking to produce as much as 2.2 million barrels per day by November.
Saudi officials spearheaded production boosts to enforce Iraq and Kazakhstan's oil quota compliance, according to Reuters.
Barclays has lowered its Brent oil price forecast to US$66 per barrel for 2025, down $4 from its earlier projections, due to production increases.
“Tariff-related developments have certainly been a drag but the OPEC+ pivot has also been a significant driver of the move lower in oil prices of late,” said Barclays.
OPEC+ will hold a full ministerial meeting on 28 May.
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