Oil plunges by over 6% after OPEC output hike
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Oil prices plunged more than 6% on Thursday, with WTI crude sinking to $67 per barrel and Brent crude falling below $72, marking their steepest single-day decline in nearly four months.
US crude inventories unexpectedly surge Adding to the bearish sentiment, US crude inventories unexpectedly surged by 6.2 million barrels last week, in stark contrast to expectations of a 2-million-barrel draw. The stockpile increase was largely driven by a significant uptick in Canadian oil imports, reflecting improved pipeline flows and refinery maintenance season disruptions. Meanwhile, gasoline and distillate stockpiles also saw slight builds, further signaling weaker demand. Looking ahead, traders are closely watching developments in global trade policy, further OPEC+ production signals, and upcoming US economic data for clues on future oil price direction.
Oil plunges by over 6% after OPEC output hike
The sharp drop came after eight OPEC+ countries unexpectedly announced they would boost oil production by 411,000 barrels per day in May, far exceeding the initially planned 135,000 bpd increase. OPEC defended the decision by pointing to "strong market fundamentals" but noted that future output hikes could be paused if demand conditions deteriorate. Even before the OPEC+ surprise, oil prices had already been under significant pressure, sliding more than 4% earlier in the session following President Trump's announcement of sweeping new tariffs, which heightened concerns about a global trade war potentially slowing economic growth and reducing fuel demand. While crude oil imports were exempt from the new levies, investors remained cautious that the tariffs could still dampen broader economic activity and stoke inflationary pressures.US crude inventories unexpectedly surge Adding to the bearish sentiment, US crude inventories unexpectedly surged by 6.2 million barrels last week, in stark contrast to expectations of a 2-million-barrel draw. The stockpile increase was largely driven by a significant uptick in Canadian oil imports, reflecting improved pipeline flows and refinery maintenance season disruptions. Meanwhile, gasoline and distillate stockpiles also saw slight builds, further signaling weaker demand. Looking ahead, traders are closely watching developments in global trade policy, further OPEC+ production signals, and upcoming US economic data for clues on future oil price direction.