OPEC+ production growth reduces demand for US WTI crude

According to Reuters, European and Asian refineries are increasing demand for raw materials from OPEC+ suppliers. At the same time, they are now less interested in US WTI crude.

In recent months, OPEC+ members have decided to boost oil production by 1.37 million barrels per day (bpd). The initial quota restrictions of 2.2 million bpd are expected to be completely phased out by October. The increase in supplies from these countries makes oil more accessible to importers.

Such changes in the oil market are negative for American companies. Based on the Energy Information Administration (EIA) data, US oil exports dropped from 4 million to 3.8 million bpd in May. Jeremy Irwin from Energy Aspects expects this trend to continue in the coming months. During the summer, refineries prefer medium and heavy crude grades over light ones from the US.

According to Energy Aspects analysts, American raw materials in Asian markets will be replaced by supplies from the Middle East and Kazakhstan. In Europe, competition between oil exporters from the US, Guyana, Brazil, and North Africa will intensify. This will keep prices relatively low.