Brent, WTI Prices Mixed as Market Braces for Output Increase

Oil prices were mixed on Tuesday, but remained under pressure from expectations that Saudi Arabia and Russia would pump more crude to ease a potential shortfall in supply.

Brent crude futures were up 21 cents, or 0.28%, at $75.51 a barrel, after settling at their lowest since May 8 at $75.30. US West Texas Intermediate crude was down $1.11, or 1.64%, at $66.77 a barrel, sitting around its lowest since April 17, CNBC reported.

“Investors have started pricing in the likelihood of Saudi Arabia and Russia increasing crude oil production,” ANZ Bank said in a note.

“However, doubt remains, with any agreement to be finalized at the June OPEC meeting.”

Concerns that Saudi Arabia and Russia could boost output have put downward pressures on oil prices, along with rising oil production in the United States.

Saudi Arabia and Russia have discussed raising OPEC and non-OPEC oil production by some 1 million barrels per day to make up potential supply shortfalls from Venezuela and Iran.

The Organization of Petroleum Exporting Countries is due to meet in Vienna, Austria, on June 22.

The spread between Brent and WTI stands at around $8.7 a barrel, the widest since March 2015 due to the depressed price of US crude compared to Brent.

“The way I see it is that WTI prices are stabilizing rather than falling after rising sharply in recent weeks because the prices were expected to be in the range of $55-65 a barrel,” said Vincent Hwang, commodity analyst at NH Investment & Securities in Seoul.