Oil prices plummeted over $2 per barrel on Friday after Saudi Arabia and Russia discussed the possibility of reducing OPEC’s production cuts that have been largely responsible for pushing crude prices to their highest levels since 2014.
U.S. WTI futures closed last week at $67.88 per barrel, down nearly 4.9 percent for the week. The 4 percent loss on Friday was the commodity’s biggest slide since February and was a turn after six consecutive weeks of gains. Brent crude futures also struggled on Friday, sliding 3 percent to close at $76.44 per barrel. U.S. WTI futures eased 2.7 percent last week after hitting a near 4-year peak of $80.50 during the prior week.
The next OPEC meeting will be held in Vienna in June, but energy ministers from Saudi Arabia and Russia met in St. Petersburg last week to review the current production cuts in advance of the meeting. At the meeting, the participants considered the possibility of increasing production by 1 million barrels per day, Reuters reported. The decision to curb production cuts could be made as early as the upcoming OPEC meeting.
As of 1:53 p.m. HK/SIN on Sunday, Brent futures were unchanged and U.S. WTI futures were down to $67.50 per barrel.
Also making headlines over the weekend was an announcement that U.S. Commerce Secretary Wilbur Ross will be visiting China from June 2 to June 4, in another effort to ease the trade disputes between the U.S. and China. The tensions escalated on Thursday after the announcement of a U.S. government security probe into auto imports which could lead to additional trade bans. U.S. President Donald Trump has also recently threatened to implement up to $150 billion of tariffs on Chinese goods to negate what he claims is Beijing’s misappropriation of U.S. technology.