Oil posts first weekly loss since May on Opec+ supply stalemate

Bloomberg

Oil falls this week for the first time since May after days of volatile trading in the wake of Opec+’s stalemate over a production
increase in the near term.
Futures in New York declined 0.8% this week, although the US crude benchmark closed higher amid a broader market rebound. A stronger dollar makes commodities priced in the currency less attractive to investors.
“Nobody really knows how the supply growth is going to project from here,” said Peter McNally, global head of industrials, materials and energy at Third Bridge. “The world needs more oil and was expecting more oil, so while there’s this uncertainty around supply, demand keeps growing.”
Oil accelerated to a six-year high earlier this week after Opec+ failed to ratify a production rise, spurring concerns of a supply shortfall. Fuel consumption is rising in countries such as the US, India and China during the summer driving season. Americans have hit the road with gusto, leading to rapidly draining inventories and US refineries running close to full-bore to keep up with demand.
“We’re now in the middle of what appears to be an extremely robust summer and the US seeing very large stock draws, fundamentally, that we anticipate will continue to support the market,” said Michael Tran, an analyst at RBC Capital Markets.
Meanwhile, traders are also eyeing the global spread of the delta variant, which has taken hold in countries with lower vaccination rates, especially in Asia.

New mobility restrictions threaten a further oil demand recovery.