Oil Prices Slide as OPEC+ Hikes Output, U.S. Demand Disappoints

Oil prices fell to one-week lows on Monday after OPEC+ confirmed a sizeable supply increase for September, stoking concerns of a global surplus amid weakening demand in the United States.

Brent crude settled down 91 cents, or 1.3%, at $68.76 a barrel, while West Texas Intermediate (WTI) lost $1.04, or 1.5%, to close at $66.29. Both benchmarks had already fallen nearly 3% on Friday.

OPEC+ announced it will raise output by 547,000 barrels per day (bpd) in September—part of a rapid unwinding of its pandemic-era cuts. The move was largely expected but underlined the group's strategy to regain market share, despite growing signals of softening demand.

U.S. data last week revealed the weakest May gasoline consumption since 2020, typically the start of peak summer driving. Domestic crude production also hit a record monthly high, intensifying fears of oversupply.

Traders are now eyeing the group’s 7 September meeting, where a potential rollback of an additional 1.65 million bpd in cuts is on the agenda. “OPEC+ retains significant spare capacity, and the market is watching closely for signs it may deploy it,” said Alex Hodes of StoneX.

Meanwhile, geopolitical uncertainty added complexity. U.S. President Donald Trump threatened 100% tariffs on buyers of Russian oil, including India, which has so far resisted pressure to curtail purchases. ING estimates up to 1.7 million bpd of crude supply could be at risk if Indian refiners halt Russian imports.

“Markets are now squarely focused on Trump’s decision due Friday, which could trigger further volatility,” UBS analyst Giovanni Staunovo noted.