Oil prices dipped as OPEC+ output plans raised supply concerns

Oil prices fell on Tuesday, 27 May, as market participants adopted a cautious stance ahead of a pivotal OPEC+ meeting scheduled for the weekend. Growing expectations that the producer alliance may opt to accelerate the reinstatement of previously withheld supply—alongside signs of easing geopolitical tensions—have heightened fears of a potential oversupply in the second half of the year.

Brent crude futures settled 65 cents lower, or 1%, at $64.09 per barrel. 

WTI crude dropped 64 cents, or 1.04%, to close at $60.89 per barrel.

Attention is now firmly on Saturday’s OPEC+ meeting, where several member states are reportedly in favour of a faster pace of supply restoration. According to Reuters, the group is expected to approve an additional output increase for July—possibly exceeding current market forecasts.

The anticipated decision comes amid tentative progress in US-Iran nuclear negotiations, which could ultimately result in the return of Iranian crude to international markets.

Despite a nuanced backdrop of bullish and bearish geopolitical signals, Tuesday’s declines were largely attributed to technical factors. Market sources cited short-term trading activity by commodity trading advisers (CTAs) as a key influence on the day’s downward movement, suggesting the price action may not indicate a broader shift in underlying market sentiment.