Oil prices climbed on Wednesday, recovering slightly from recent four-year lows, as investors turned their focus to upcoming trade talks between the United States and China and reacted to new production decisions by OPEC+.
By 9:16 AM WAT, Brent crude futures rose by 99 cents, or 1.3%, reaching $63.14 per barrel, while U.S. West Texas Intermediate (WTI) crude gained 81 cents, or 1.4%, to trade at $59.90 per barrel.
The recent plunge in oil prices came after eight OPEC+ member countries announced plans to ramp up production, raising concerns of an oversupply amid weakening global demand. This oversupply concern was further compounded by rising U.S. tariffs that have triggered fears of slowing international trade.
However, some U.S. energy companies, including Diamondback Energy and Coterra Energy, responded to falling prices by cutting back on drilling activity. Analysts suggest this move could help stabilize the market by reducing overall output in the coming months.
In another potentially price-supportive development, U.S. crude oil inventories dropped by 4.5 million barrels in the week ending May 2. Official government data on stockpile levels is expected later today at 10:30 a.m. ET (1430 GMT).
Meanwhile, European companies are on track to report a 0.4% increase in first-quarter earnings—an improvement from the 1.7% decline analysts previously forecast.
OPEC+’s decision to boost output came during a virtual meeting held on Saturday. Saudi Arabia, Russia, and six other members (Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman) agreed to increase collective production by 411,000 barrels per day in June, up from 137,000 barrels in May. This move is part of a gradual rollback of 2.2 million barrels per day in voluntary cuts that began in April 2025.
The coalition emphasized that production hikes could be paused or reversed based on market conditions, providing flexibility to manage supply and maintain stability.
OPEC+ also reaffirmed its commitment to full compliance with the Declaration of Cooperation, stressing that any excess production since January 2024 would be fully compensated. These adjustments will be monitored by the Joint Market Monitoring Committee (JMMC), which last convened on April 3, 2024.
The group is scheduled to reconvene on June 1, 2025, to determine production levels for July.
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