U.S. producers just keep drilling.
Oil prices fell Friday, June 1, as U.S. production remains vigorous and OPEC and Russia may ramp up output.
U.S. benchmark West Texas Intermediate crude futures for July delivery fell about 1% to $66.39 at 1 p.m. New York time. Brent crude, the global benchmark, dipped 0.6% to $77.07.
"U.S. production growth remains robust and weekly data shows no signs of slowing down," said Seaport Global analysts, adding that the growth is largely being driven by Texas and New Mexico.
Crude production jumped 215,000 barrels per day to 10.47 million barrels per day in March, according to the U.S. Energy Information Administration. Production in Texas, which is where the oil-rich Permian basin is located, rose by 4% to 4.2 million barrels per day, while output in New Mexico jumped 6.5% month over month.
Oil producers in the U.S. brought two rigs online for a total of 861, according to Baker Hughes (BHGE) . Gas rigs, meanwhile, fell by one to 197 and Miscellaneous rigs remained unchanged at two, bringing the overall total U.S. rig count to 1,060.
The ramp in U.S. crude production comes amid speculation that the Organization of Petroleum Exporting Countries, or OPEC, and Russia are considering increasing production to ease the potential supply disruptions in Iran and Venezuela.
Russian President Vladimir Putin and Abu Dhabi Crown Prince Mohammed Bin Zayed Al Nahyan on Friday signed a strategic partnership agreement to cooperate on stabilizing the oil market, Bloomberg reported on Friday.
The United Arab Emirates, Kuwait and OPEC's leading producer, Saudi Arabia, are expected to meet this Saturday to discuss OPEC matters, Bloomberg reported earlier this week, citing people with direct knowledge.
While traders will be watching for any news out of the weekend meeting, until all the OPEC members reach a decision on production, oil may fluctuate. OPEC is scheduled to have a formal meeting in late June in Vienna.
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