Oil prices extend losses due to concerns of increased supply in late 2024

(Reuters) – Oil prices fell in early trading on Tuesday, extending losses from the previous session when prices fell to their lowest level in four months as investors worried about rising supply at the end of the month. year.

Brent crude futures fell 20 cents or 0.3% to $78.16 a barrel. Brent closed below $80 for the first time since February 7 after falling more than 3% on Monday.

West Texas Intermediate crude oil futures fell 17 cents, or 0.2%, to $74.05. It had also steadied near a four-month low on Monday after falling 3.6%.

The Organization of the Petroleum Exporting Countries and Russia-led allies, known together as OPEC+, agreed on Sunday to extend most of their oil production cuts until 2025, but left room for voluntary cuts by eight members to be made. gradually canceled from October onwards.

The extension of voluntary cuts through the third quarter will amplify the oil tightness over the summer, while the possibility of some supply returning from October represents a stronger indication that extreme levels of market support from OPEC+ may not last forever, said Walt Chancellor, an energy expert. strategist at Macquarie.

Signs of weakening demand growth have also weighed on oil prices in recent months, particularly data on fuel consumption in the US. The average price of gasoline in the United States fell 5.8 cents per gallon to $3.50 per gallon on Monday, according to data from GasBuddy.

The US government will release inventory and product supply data on Wednesday. The supplied product, considered a proxy for demand, will show how much gasoline was consumed over the Memorial Day weekend, the start of the US car season.

(Reporting by Arathy Somasekhar in Houston; Editing by Sonali Paul)