Oil prices slid on Tuesday, following news earlier this week that Saudi Arabia pledged to cut oil production by another one million barrels a day in July.
The news gave the oil markets a boost on Monday, but prices have since ticked lower.
Brent crude,
the international benchmark, lost 0.5% to $76.34 a barrel, while
West Texas Intermediate,
the U.S. standard, declined 0.3% to $71.95 in midday trading Tuesday.
Oil stocks were mixed, with
Chevron
(ticker: CVX) down 0.3%,
Exxon Mobil
(XOM) rising 0.5%, and
ConocoPhillips
(COP) down 0.4%.
“In theory, the production cuts would be bullish, creating a supply deficit in the physical markets, but the combination of a significant rise in non-OPEC+ production expected for next year and ongoing worries about consumer demand given the still-elevated threat of a recession in [the second half of 2023] helped offset the OPEC+ news,” wrote Tom Essaye, president of Sevens Report Research on Tuesday.
“Looking ahead, those latter two dynamics should help keep a lid on the oil market in the months ahead and limit any rally at 2023 resistance just over $80 a barrel,” Essaye added.
Write to Emily Dattilo at [email protected]
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