Oil prices dipped in early Asian trading on Friday as investors weighed uncertainty over potential production moves by OPEC+, which is scheduled to meet this weekend.
Crude futures were headed for weekly losses, with an unexpected increase in U.S. inventories adding pressure and raising concerns about slowing fuel demand.
As of 20:38 ET (00:38 GMT), Brent crude for November delivery fell 0.2% to $66.83 a barrel, while West Texas Intermediate (WTI) lost 0.2% to $62.88 a barrel.
OPEC+ Output Questions Continue to Weigh
Traders are expecting weekly losses between 1% and 1.5%, amid worries that rising supplies may outpace demand. OPEC+—the coalition of OPEC members and allied producers—is set to meet this weekend to discuss output.
Reports indicate that some members are considering further production increases after the cartel boosted output by roughly 2.2 million barrels per day earlier this year. Any additional increases would continue to roll back the deep cuts OPEC imposed over the last two years, as the group seeks to strengthen its market position and reclaim share.
Russian oil output has drawn particular attention, with U.S. efforts aimed at limiting purchases by key buyers like India and Europe. However, Moscow recently agreed to deliver at least 2.5 million metric tons of oil annually to China via Kazakhstan, likely keeping production elevated.
U.S. Inventory Build Adds to Pressure
The market was also shaken by a surprise rise in U.S. crude stocks. Data from the Energy Information Administration showed inventories increased by 2.415 million barrels in the week ending August 29, well above expectations for a 2 million-barrel draw.
Distillate inventories also unexpectedly rose, while gasoline stocks drew down more than anticipated. The figures reinforced concerns that U.S. fuel demand is softening, particularly after the summer travel season concluded.
Additional worries stem from signs of a cooling labor market, prompting questions about fuel consumption in the months ahead. Investors are now closely watching the U.S. nonfarm payrolls report for August, scheduled later in the day, for clues on economic trends and potential interest rate adjustments.
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