Oil price slipped globally on Monday following increase in crude production by members of the Organization of Petroleum Exporting Countries, OPEC. OPEC’s output rose in April to 32.64 million barrels per day (bpd), close to the highest level in recent history.
Iraq’s April exports from southern fields increased by 3.36 million barrels a day, as did seaborne exports from Russia, the biggest exporter outside OPEC. Brent LCOc1 was trading at $47.20 per barrel at 1130 GMT (6:30 a.m. ET), down 17 cents from its last settlement. U.S. crude CLc1 was down 2 cents at $45.90 a barrel while OPEC’s daily basket pegged at $42.70 a barrel.
On Friday, the June Brent contract expired at $48.13 a barrel, a 21.5 percent gain over the month that marked the largest monthly advance since May 2009. Earlier in that session it reached $48.50, a six-month high. The price slide, which came amid low liquidity due to the May Day holiday, contrasted with broader investor confidence in an oil price rebound. The chief of the International Energy Agency (IEA) said oil prices may have bottomed out if no major global economic issues emerge
“In a normal economic environment, we will see the price direction is rather upwards than downwards,” IEA Executive Director Fatih Birol said on Sunday during a G7 meeting of energy ministers in Japan. Non-OPEC output is set to mark its biggest decline in around 20 years, Birol said. At the G7 meeting, U.S. The IEA’s Birol also said a drawdown in global stockpiles should start toward the end of the year, though some U.S. shale producers are using the price rally to hedge their production.