Oil prices rose on Tuesday after a sharp drop triggered by OPEC+’s announcement to increase production, amid ongoing concerns about oversupply.
Brent crude rose by around 1.94%, trading at $61.42 per barrel at 10:42 a.m. local time (0742 GMT), up from $60.25 at the previous session’s close.
US benchmark West Texas Intermediate (WTI) rose about 2.01%, reaching $58.15 per barrel, up from $57 in the previous session.
Prices rebounded on profit-taking after hitting their lowest level since February 2021 on Monday, following a decision by eight members of the Organization of the Petroleum Exporting Countries (OPEC) and its allies -known as OPEC+- to ramp up production.
Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria and Oman announced on Saturday that they will increase oil production in June by 411,000 barrels per day compared to May levels, gradually reversing voluntary output cuts.
Top producers Saudi Arabia and Russia will lead the increase, which analysts say signals a substantial rise in global oil supplies in the coming months.
In addition to bargain-hunting by investors, anticipation over the US Federal Reserve’s (Fed) upcoming policy decision also contributes to the upward pressure on oil prices.
While markets widely expect the Fed to hold interest rates steady, pricing suggests a 72% chance of a rate cut in July, an outlook that could weaken the US dollar, boost oil demand, and support higher prices.
Meanwhile, concerns that US President Donald Trump’s protectionist trade policies could hamper global economic growth and curb oil demand are limiting further gains in prices.
On Sunday, Trump called for a 100% tariff on all films produced outside the United States.
‘WE WANT MOVIES MADE IN AMERICA, AGAIN!’ the president posted on social media. It confused many in Hollywood, which has lost plenty of film and television production to other states — such as Louisiana and Texas — and nations that offer greater tax credits and cheaper labor.
Analysts noted that although the tariff hike was postponed nearly a month ago, no concrete progress has been made on trade agreements, adding that lingering uncertainty continues to weigh on companies’ long-term supply and trade strategies.
