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Oil Down, OPEC+ Decides on Supply Increase Even as COVID-19 Cases Continue to Rise By Investing.com

© Reuters.

By Gina Lee

Investing.com – Oil was down Wednesday morning in Asia, as investors digested an Organization of the Petroleum Exporting Countries and its allies (OPEC+) . The cartel’s decision comes as the surge of COVID-19 cases in countries including India continues to cast a shadow over fuel demand.

inched down 0.09% to $65.81 by 11:34 PM ET (11:34 AM GMT) and inched down 0.02% to $62.93.

OPEC+’s Joint Ministerial Monitoring Committee agreed on Tuesday to increase global crude oil supply from May onwards after revising its demand growth forecasts for 2021 the day before. British oil and gas company BP (NYSE:) Plc. also expects a strong recovery for the market.

OPEC+ will reportedly skip its scheduled full ministerial meeting, due to have taken place later in the day, after announcing its decision and will next meet on Jun. 1.

Crude oil demand is reportedly set to record its biggest climb in the next six months due to increased COVID-19 vaccination rates in Europe.

Meanwhile, the flare-up of COVID-19 cases globally, including in India and Brazil, continues to raise concerns over near-term demand.

“Oil demand has yet to recover to pre-virus levels and we see room for further tightening of the oil supply balance in the second half,” Howie Lee, economist at Oversea-Chinese Banking Corp., told Bloomberg.

“The biggest swing driver for oil right now is the state of the COVID-19 outbreak in India,” Lee added.

Also on the supply side, showed a build of 4.319 million barrels for the week ending Apr. 23. Forecasts prepared by Investing.com predicted a 375,000-barrel build, while a 436,000-barrel build was recorded during the previous week.

Investors await , due later in the day.

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