Oil prices drop below $70 after OPEC+ announces production boost
Photo: Oil has fallen in price (Getty Images)
Oil prices continued to fall after the Organization of the Petroleum Exporting Countries and their allies, OPEC+, agreed to another major increase in production. Additional pressure on the market is being driven by concerns over an economic slowdown in the United States, the world's largest oil consumer, Reuters reports.
On Monday, August 4, Brent crude futures fell by 40 cents to $69.27 per barrel. US WTI dropped 37 cents to $66.96 per barrel. Both benchmarks had declined by about $2 on Friday.
OPEC+ ramps up production
On Sunday, OPEC+ agreed to increase oil production by 547,000 barrels per day in September. This is another step in the group's accelerated effort to regain market share, which it attributes to steady economic growth and low inventories.
The decision was in line with market expectations and marks the full and early removal of the largest package of production curbs, along with a separate increase for the UAE. The total increase will amount to about 2.5 million barrels per day - roughly 2.4% of global demand.
Actual supply to be lower than announced
Goldman Sachs analysts forecast that the real increase in supply from the eight OPEC+ countries that have raised production since March will be around 1.7 million barrels per day - about two-thirds of the announced volume.
The remaining members of the group, according to the bank, have reduced output following a period of overproduction. "While OPEC+ policy remains flexible and the geopolitical outlook uncertain, we assume that OPEC+ keeps required production unchanged after September," the analysts noted.
Risks from Russia and Iran persist
RBC analyst Helima Croft stated: "The bet that the market could absorb the additional barrels seems to have paid off for the holders of spare capacity this summer, with prices not that far off from pre-tariff Liberation Day levels."
However, investors remain concerned about potential new US sanctions against Iran and Russia. President Trump has threatened to impose 100% secondary tariffs on buyers of Russian oil as a way to pressure Moscow over the war in Ukraine.
Investors worried about sanctions and slowing growth
Sources reported that at least two tankers carrying Russian oil bound for India were redirected to other countries due to new US sanctions.
Still, two Indian government officials told Reuters that the country would continue purchasing Russian oil despite Donald Trump's threats. In addition, concerns persist over the impact of US tariffs on global growth and fuel consumption.
US Trade Representative Jamieson Greer stated that the tariffs imposed last week against dozens of countries are likely to remain in place.
Global oil prices are a key factor influencing gasoline and diesel prices in Ukraine. In June, fuel prices in Ukraine spiked due to the oil price surge amid the war with Iran.
Retail prices for gasoline and diesel in Ukraine remained mostly unchanged in July 2025.
