SULAIMANI (ESTA) — Oil prices fell more than 1% on Thursday, extending losses as investors braced for more supplies following a compromise between top OPEC producers and as U.S. fuel stocks rose.
Brent crude futures dropped 84 cents to $73.92 a barrel by 0631 GMT while U.S. West Texas Intermediate (WTI) crude was 99 cents down at $72.14 per barrel.
“The market is not taking any chances. Prices are very overbought anyway so traders might want to take some money off the table before the deal is concrete,” Reuters quoted Avtar Sandu, senior commodity trader at Phillips Futures in Singapore, as saying.
Saudi Arabia and the UAE reached a compromise that should pave the way for a deal to supply more crude to a tight oil market and cool soaring price, Reuters reported.
Talks among the Organization of the Petroleum Exporting Countries and their allies including Russia, a group known as OPEC+, had broken down earlier this week after the UAE objected to extending the supply cut deal beyond April 2022.
“The deal will take some time to get finalized, but it seems the UAE will be allowed to produce more output next year,” OANDA analyst Edward Moya said in a note, according to Reuters.
“It seems OPEC+ will shortly have a plan to raise output and that is welcomed news as surging demand had oil market getting too tight.”