WTI and Brent crude oil test the 52-week moving average as OPEC raises production, Hormuz risks fade, and traders await EIA inventory data.
Ukraine struck three Russian oil refineries and an oil terminal in the Baltic Sea port of Vysotsk, Ukraine's military and security service said on Monday, as Kyiv intensifies its attack on Russian energy infrastructure.
Oil fell, weighed by the OPEC+ decision to increase output again. After a virtual meeting on Sunday, the group said it would hike production by about 188,000 barrels a day in August, marking fifth consecutive monthly increase.
The oil-producing group agreed during an online meeting to increase quotas by 188,000 barrels per day from August, on top of similar increases for June and July.
Major oil producers on Sunday agreed once again to modestly increase their crude production, although, as in previous months, the hike is largely symbolic until a peace deal between the U.S. and Iran sticks and the Strait of Hormuz is fully reopened to shipping traffic.
OPEC+ approved a new production increase for August as recovering crude supplies and easing geopolitical concerns kept oil prices near pre-conflict levels.
OPEC+ is set to agree on Sunday another increase in output targets from August, sources with knowledge of the matter said, adding to global supply amid falling oil prices due to a gradual reopening of the Strait of Hormuz for oil exports.
President Trump is ramping up pressure on the industry to lower gas prices ahead of November's midterm elections.
Traders on the prediction market Polymarket see a real chance that oil prices fall further this month, having already retreated to levels last seen before the Iran war. The market, which asks what price West Texas Intermediate crude will hit during July, gives a 24% probability that the US benchmark drops as low as $60 a barrel.
Canada announced plans to build a new oil pipeline from Alberta to the Pacific coast, which would give the world's fourth-largest oil producer greater capacity to export to Asia and ease its reliance on the United States.
Oil prices rose slightly on Friday before a long holiday weekend in the U.S. as wary optimism held over efforts to make peace in the Middle East between the United States and Iran.
Oil fell in early trade as concerns over supply disruptions in the Middle East continue to ease.