Oil prices continued to decline with the opening of the US market on Friday, on its way to incurring the first loss within the last four days, due to the halt of the decline of the US dollar against a basket of global currencies, in addition to the evaluation of dealers of OPEC Plus’s decision to increase supplies starting from next month, and its impact On the balance of the market in light of the continued weak demand for fuel in Europe.
US crude fell by 1.0% to $ 59.15, from the opening level at $ 59.76, and recorded the highest level at $ 59.92, and Brent crude fell by 1.1% to the level of $ 62.59 a barrel, from the opening level at $ 63.26, and recorded the highest level at $ 63.46 .
When prices settled on Thursday, US crude rose by 0.5%, and Brent crude futures rose 0.7%, the third consecutive daily gain, as supply concerns subsided in the United States.
The dollar index rose on Friday by about 0.3%, to rebound from its lowest level in two weeks at 91.99 points recorded yesterday, reversing the halting wave of the decline of the US currency against a basket of major and minor currencies, which negatively affects the prices of commodities and metals denominated in the US dollar.
These developments come in light of the rebound in the yield of the US Treasury bonds for ten years from the lowest level in several weeks, which undermines the investor’s appetite towards buying high-yielding assets.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, a group known internationally as OPEC Plus, have agreed to gradually increase supplies by 1.1 million barrels per day between May and July.
The agreement provides for an increase of 350,000 barrels per day in May, a similar increase in June, and an increase of about 400,000 barrels per day in July.
Under this agreement, current production cuts decline by about 7.2 million barrels in April to 6.85 million barrels in May, then to 6.5 million barrels in June, and then to 6.1 million barrels per day in July.
The Kingdom of Saudi Arabia said that during that period it would also reverse its voluntary reduction by one million barrels per day, which it had done since last February, and would increase its production by 250,000 barrels in May, then by 350,000 barrels in June, in addition to 400,000 Barrels in July.
In Europe, demand for fuel is still weak, in light of the extension of the closure measures to limit the spread of the third wave of the Corona virus, in addition to the delay of vaccination operations against infection in most parts of Europe, which is expected to negatively affect the recovery of the eurozone economy.