Speaking to reporters after a meeting with Russia's Energy Minister Alexander Novak, the minister of OPEC's biggest producer Saudi Arabia, said, "I think it's inevitable". With record amounts of Oil all over the place, including the fully loaded ships at sea, Oil prices are artificially Very High!
Russian Federation and Saudi Arabia, the leaders and largest producers of the non-OPEC and OPEC producers in the deal, have started to hint that they could reverse some of the cuts "to ease consumer and market anxiety", and reports have it that the production boost could be as much as 1 million bpd.
"The deluge of United States crude production continues to hold the top-side in check", said Stephen Innes, head of trading at futures brokerage OANDA.
Oil prices have faced one jolt already this year.
Just nine days before a big OPEC meeting, US President Donald Trump joined the oil-market fray on Wednesday, blaming the group for high prices. But the rising output came amid strong demand, which traders said prevented crude prices from falling further. "Not good!" U.S. president Donald Trump tweeted. This was mainly due to increase in supply from Russia, Venezuela and other OPEC nations that were desperate for cash.
Brent crude futures LCOc1, the global benchmark for oil prices, were at $75.65 per barrel at 0329 GMT, down 23 cents, or 0.3 percent, from their last close.More news: Mexico in pole position with South Korea win
The two sides kicked off formal talks in Beijing on Monday for forming an oil buyers' club, a development that is likely to weigh on Opec ministers, who are meeting to discuss an end to production cuts later this month. Prices last month were further boosted to the highest level since 2014 after a U.S. decision to reimpose sanctions on Iran threatened to curb exports from the Islamic Republic and as economic turmoil in Venezuela hurt the Latin American nation's output.
US crude production has surged over the past eight years thanks to a shale boom, driven primarily by gains in the prolific Permian basin, which stretches across West Texas and eastern New Mexico.
Moscow believes the new arrangement it proposes would provide stability for the oil market through a period of high demand during the northern hemisphere summer, the person said.
But the Paris-based IEA, echoing statements from oil producers as well as analyst comment in recent weeks, said there may be a change to the so-called Vienna agreement.
OPEC's own oil production rose slightly in May, the monthly report showed.
The International Energy Agency (IEA) expects the global crude oil demand to go up by 1.4 mln barrels per day in 2019. The country pumped 11.09 million barrels a day in the first week of June, according to a person with knowledge of the matter, exceeding its agreed limit of 10.95 million.
Because the cuts have gone deeper than intended, overall supply from the group would still be about 1 MMbpd below the pre-cuts levels even after the 1.8 MMbbl quota increase, the person said.