Oil prices dropped on Thursday following weak U.S. payrolls data and as traders takes profit.
Brent futures fell to $89.10 down by 0.41% while WTI futures fell to $87.73 down by 0.60%.
“This morning’s dip might be a result of the shockingly low U.S. ADP employment print last night, but we believe the supply squeeze may drive oil prices higher through this year,” said Howie Lee, economist at OCBC in Singapore, as reported by Retuers.
However, tight global supplies and tensions in the eastern Europe and Middle East has lead crude oil prices to rally 15% this year.
“The oil market is not really any closer to seeing additional barrels of crude, but today we are not seeing any fresh catalysts to send prices to fresh highs,” said Edward Moya, senior market analyst at OANDAas reported by Reuters.
The Organization of the Petroleum Exporting Countries and allies led by Russia, known as OPEC+, agreed on Wednesday to stick to moderate rises of 400,000 barrels per day (bpd) in its oil output with the group already struggling to meet existing targets and despite pressure from top consumers to raise output more quickly.
“OPEC+ will save larger-than-expected production promises for when oil is over $100 a barrel,” said Moya.
