Brent crude eases below $75 a barrel

London — Crude oil prices retreated on Tuesday, after Brent rose above $75 a barrel for the first time since April 2019 and as Opec+ begins discussions on raising oil production, but a strong demand outlook underpinned prices.

Brent crude futures fell 53c, or 0.7%, to $74.37/bbl by 9.39am GMT, after hitting a session high of $75.30, the strongest since April 25, 2019.

US West Texas Intermediate (WTI) was at $72.97/bbl, down 69c, or 0.9%.

Opec and its allies, collectively known as Opec+, are discussing a gradual increase in oil output from August, but no decision has been taken on the exact volume yet, an Opec+ source said on Tuesday.

Opec+ is already returning 2.1m bbl/day to the market from May until end of July, gradually unwinding last year’s record output curbs, as demand recovers from the pandemic.

The group is scheduled to meet on July 1.

Both benchmarks have risen for the past four weeks in response to the rollout of global Covid-19 vaccinations and an expected pickup in travel.

BofA Global Research raised its Brent price forecasts for this year and 2022,  saying that tighter oil supply and recovering demand could push oil briefly to $100/bbl next year.

Negotiations to revive the Iran nuclear deal took a pause on Sunday after hardline judge Ebrahim Raisi won the country’s presidential election.

Raisi on Monday backed talks between Iran and six world powers to revive a 2015 nuclear deal but flatly rejected meeting US President Joe Biden, even if Washington removed all sanctions.

US crude stocks were expected to drop for the fifth consecutive week, while distillate and gasoline were seen rising last week, a preliminary Reuters poll showed on Monday.

Reuters