Oil prices tumbled more than 2% on Monday over expectations of a supply boost from OPEC+, while trade war-sparked demand worries linger.
West Texas Intermediate (CL=F) futures fell more than on Wednesday to trade near $57 a barrel, while Brent crude (BZ=F), the international benchmark, also dropped to near $60 per barrel.
Prices declined after members of the Organization of Petroleum Exporting Countries on Saturday agreed to boost production levels next month by the same increase as in May. Wall Street anticipates the cartel will likely raise output in July too.
OPEC began unwinding multiyear production curbs as it reverses its prior initiative of supporting prices. Reuters recently reported that the group’s leader, Saudi Arabia, is willing to live with lower prices for a prolonged period, hinting at a faster unwind of cuts in order to expand market share.
In April, crude oil prices capped their worst monthly drop since November 2021 amid fears over a global economic downturn and demand shock from President Trump’s tariff policy.
Over the weekend Goldman Sachs dropped its forecast on higher supply from OPEC.
“We now forecast Brent/WTI to average $60/56 (vs. 63/59 prior) in the remainder of 2025 and $56/52 (vs. 58/55 prior) in 2026,” wrote Goldman Sachs’ Daan Struyven and his team.
“Our key conviction remains that high spare capacity and high recession risk skew the risks to oil prices to the downside despite relatively tight spot fundamentals,” added Struyven.
