Oil Mixed, Impact from Saudi Price Cuts and OPEC+ Supply Increase Continues By Investing.com

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© Reuters.

By Gina Lee

Investing.com – Oil was mixed Tuesday morning in Asia. Fuel demand remains a concern as investors continue to digest Saudi Arbia’s sharp cuts to crude contract prices.

was up 0.44% to $72.54 by 11:39 PM ET (3:39 AM GMT) while was down 0.22% to $69.14.

Saudi Aramco (SE:) cut October official selling prices (OSPs) for all crude grades sold to Asia by at least $1 a barrel earlier in the week. The state oil group’s cuts signaled that demand in the region remains weak as some countries imposed restrictive measures to curb their latest COVID-19 outbreaks.

The Organization of the Petroleum Exporting Countries and allies (OPEC+), also decided at its latest meeting to raise output by 400,000 barrels per day a month between August and December 2021.

“It’s quiet in Asian trading amid uncertainty over the direction of the market going forward,” Fujitomi Securities Co Ltd. analyst Toshitaka Tazawa told Reuters.

“We expect that oil prices will struggle to move higher as the U.S. summer driving season wanes after Labor Day weekend and as a weaker-than-expected U.S. jobs report underlined slow economic activities,” he added.

The report, released during the previous week, showed that non-farm payrolls were lower than expected and weighed on the fuel demand outlook.

Meanwhile, U.S. supply continues to be limited as the recovery from Hurricane Ida, which made landfall in the Gulf of Mexico more than a week ago. About 1.5 million barrels per day of oil production, or 84%, remains shut, while another 1.8 billion cubic feet per day of output, or 81%, was offline, in the region, the said on Monday.

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