WTI Crude Falls to $68.55 as OPEC+ Raises August Output Target

WTI crude for August delivery closed at $68.55 per barrel on July 6 (US Eastern Time), down $0.14 (0.20%), while Brent crude settled at $71.99, down $0.13 (0.18%). The decline followed OPEC+ announcing on July 5 an August production increase of 188,000 barrels per day, while oil supply via the Strait of Hormuz continued to recover as tankers departed the Gulf following the US-Iran ceasefire memorandum of understanding. Markets were closed July 3 for the US Independence Day substitute holiday. Oil prices have moved sideways since the US-Iran ceasefire MOU brought levels down to pre-conflict ranges, with market participants monitoring ceasefire negotiation developments.

OPEC+ Announces August Production Increase of 188,000 Barrels Per Day

OPEC+ announced on July 5 that member countries will raise crude oil production by 188,000 barrels per day starting in August. The alliance has increased output continuously for five months since April, with total production additions reaching 940,000 barrels per day during this period. The United Arab Emirates, which exited OPEC in June, has raised production above 3.8 million barrels per day — near record levels. Robert Yawger, director of energy futures at Mizuho, stated that Gulf producers appear to be preparing for a price war.

Tanker Departures from Strait of Hormuz Raise Seaborne Oil Supply

Tankers previously held in the Strait of Hormuz have been departing the Gulf, increasing seaborne crude supply. Giovanni Staunovo, analyst at UBS, noted that "tankers tied up in the Strait of Hormuz are working to exit the Gulf, raising oil supply at sea," adding that "this continues to put downward pressure on prices." The supply increase follows the signing of the US-Iran ceasefire memorandum of understanding, which eased conflict-related shipping restrictions in the waterway.

FAQ

What caused WTI crude prices to fall on July 6?

WTI crude declined $0.14 to $68.55 per barrel on July 6 (US Eastern Time) following OPEC+ announcing on July 5 an August production increase of 188,000 barrels per day and tankers departing the Strait of Hormuz raising seaborne oil supply after the US-Iran ceasefire memorandum of understanding.

How much has OPEC+ increased production since April?

OPEC+ has raised crude oil output by a total of 940,000 barrels per day over five consecutive months from April through the announced August increase of 188,000 barrels per day.