Oil Down, Investors Digest OPEC+ Decision to Continue Supply Increase By

© Reuters.

By Gina Lee – Oil was down Thursday morning in Asia, with investors digesting an to continue increasing supply.

were down 0.39% to $71.31 by 11:50 PM ET (3:50 AM GMT) and fell 0.50% to $68.25.

OPEC+ agreed to continue adding 400,000 barrels per day (bpd) on a monthly basis at its meeting on Wednesday. The cartel also raised its demand forecast for 2022 and continues to face pressure from the U.S. to accelerate production increases.

This comes as the number of COVID-19 cases continues to rise globally, with some investors expressing doubt about the fuel demand forecast.

“What is not so certain… is whether demand will be able to grow as quickly as OPEC+ and the market predicts, given the risk of new lockdowns to fight the unresolved COVID-19 Delta variant spread,” Rystad Energy head of oil markets Bjornar Tonhaugen said in a note.

In the U.S., many refiners remained offline after Hurricane Ida hit the Gulf Coast area earlier in the week, with power and water shortages likely to impact fuel demand. An estimated 1.4 million bpd of the region’s oil production still remains offline, according to the U.S. offshore regulator.

Also in the U.S., Wednesday’s showed a draw of 7.169 million barrels in the week to Aug. 27. Forecasts prepared by had predicted a 3.088-million-barrel draw, while a 2.979-million-barrel draw was recorded during the previous week.

the day before showed a draw of 4.045 million barrels.

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