Bearish news from OPEC+
May 5, 2025
The Baker Hughes Rig Count had oil rigs down 4 to a total of 479 and last year at this time there were 499 oil rigs in operations. I saw a couple reports calling US oil production down as the result of low crude oil prices. I am not sure I agree with this if you look at the DOE data, but I guess you could call that into question. Here are the last six weeks of the report in the weekly DOE update 3/21/2005 13.574 million bpd, 3/28/2025 13.580 million bpd, 4/4/2025 13.458, 4/11/2025 13.460 , 4/25/2025 13.465.
The OPEC+ meeting happened over the weekend. On Sunday night, when trading opened, crude oil dropped on OPEC+’s decision to continue with unwinding production cuts and increasing barrels for June by 411,000 bpd. However, Saudi Arabia issued warnings against non-compliance and threatened further production hikes. Several OPEC+ members, according to Reuters, said the cartel could unwind its 2.2 million bpd voluntary cuts by November, given the comments and rhetoric by Saudi Arabia. Crude hit an overnight low of $55.30, down over three dollars, but prices have rebounded from that low and are down about a dollar currently.
The OPEC+ new is bearish but it was in line with what the market expected but the comments from Saudi Arabia may have been more than was thought.
Always a dynamic market there have been some Middle East flare up with missile strikes that are a concern and could have bullish implications so prices will continue to be volatile.