Brent falls for fourth straight session

The front-month ICE Brent contract lost $1.00/bbl on the day, to trade at $81.01/bbl at 09.00 GMT.

PHOTO: Oil barrels with a refinery in the background. Getty Images

Upward pressure:

Currently, the oil market’s attention is on the Organization of the Petroleum Exporting Countries and its allies (OPEC+).

“The key issue that currently moves [Brent] oil prices is whether or not OPEC will extend production cuts into 2025,” Price Futures Group’s senior market analyst Phil Flynn remarked.

The coalition is expected to convene in the first week of June to decide whether an extension of the ongoing 2.2 million b/d voluntary production cut is required in the second half of this year.

“There’s no doubt about the commitment by OPEC plus to continue along the path that they are on,” Flynn said.

Downward pressure:

Brent futures moved lower for the fourth consecutive day amid demand growth concerns in the world’s leading crude oil-consuming country, the US.

“Ongoing market recalibration of expectations over the US Federal Reserve’s monetary policy through the rest of this year remains centre-stage for the oil complex,” VANDA Insights’ founder and analyst Vandana Hari said.

Minutes from the US Federal Reserve’s (Fed) latest Federal Open Market Committee (FOMC) meeting showed that sticky inflation remained the US central bank’s biggest concern.

“The Fed Minutes were a buzz kill for smoking hot commodities after it said that some Fed officials might be willing to raise interest [rates], if need be,” Flynn said.

The Fed’s bearish remarks dampened the oil market’s expectation of a steady demand growth this year as it could delay interest rate cuts.

By Aparupa Mazumder

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