Oil prices have plunged more than $2 per barrel following OPEC+’s announcement to accelerate output hikes, intensifying concerns over a potential supply glut amid fragile global demand.
In early Asian trading on Monday, Brent crude futures fell by $2.04, or 3.33%, to $59.25 per barrel, while U.S. West Texas Intermediate (WTI) crude dropped $2.10, or 3.60%, to $56.19 per barrel . This decline marks a significant downturn, with WTI reaching its lowest levels since February 2021 .
The price drop follows OPEC+’s decision to increase oil production by 411,000 barrels per day starting in June, marking the second consecutive monthly output hike. This move is part of a broader strategy to unwind previous production cuts more rapidly, with the group having already added a total of 960,000 barrels per day from April through June .
Analysts suggest that the accelerated output increases are aimed at pressuring overproducing members like Iraq and Kazakhstan to comply with agreed quotas and to respond to external calls, notably from the U.S. President Donald Trump, for lower oil prices ahead of his upcoming Middle East visit .
The market reaction has been swift, with concerns mounting over the potential for oversupply in the face of weakening demand, exacerbated by escalating U.S.-China trade tensions and broader economic uncertainties .
In response to the anticipated increase in supply, Barclays has revised its oil price forecasts downward, cutting its 2025 Brent crude estimate by $4 to $66 per barrel and its 2026 forecast by $2 to $60 per barrel .
This story draws on findings and reporting from Reuters and Euronews.
