Economy
Oil Market Soars as OPEC+ Mulls August Production Hike
By Adedapo Adesanya
The oil market marginally went up on Friday as it was reported that the Organisation of the Petroleum Exporting Countries and allies (OPEC+) was planning to hike production in August.
The price of Brent crude closed at $67.77 a barrel after it gained 4 cents or 0.1 per cent and the US West Texas Intermediate (WTI) crude appreciated by 28 cents or 0.4 per cent to $65.52 a barrel.
Both benchmarks tumbled about 12 per cent in the week in their biggest drop since March 2023.
A report suggested the OPEC+ group of producers was considering a supply increase in two months’ time after a output increase of 411,000 barrels per day already planned for July.
Such a move would mark a cautious shift in policy, with OPEC+ balancing the need to keep prices from overheating with concerns about losing market share to non-member producers.
Majority of the gains the ceasefire between Israel and Iran made during the 12-day war that started after Israel targeted Iran’s nuclear facilities on June 13 have erased.
Traders and analysts said they see no material impact on oil flows in the short term, ending immediate fears of a broader regional disruption that had supported prices earlier in the week.
Brent prices rose briefly to above $80 a barrel before slumping to $67 a barrel after US President Donald Trump announced an Iran-Israel ceasefire.
Support for oil came from renewed bets on US interest rate cuts as President Trump is reportedly planning to name a successor to Federal Reserve Chair Jerome Powell earlier than expected.
The move, seen as a bid to push for aggressive rate cuts, fuelled expectations that lower borrowing costs could stimulate US economic activity and boost oil demand.
While the US central bank has so far kept its benchmark rate at 4.25–4.50 per cent, markets are watching closely for any signal of a policy shift that could revive global growth prospects and energy consumption.
