Falling Global Oil Prices Raise Concerns Among Analysts

International Desk | PNN

Crude oil prices have declined again in the global energy market amid expectations of increased supply.

After OPEC+ announced plans to raise production starting in August, expectations of higher global supply have pressured prices. The normalization of oil transportation through the Strait of Hormuz has also contributed to the decline.

At the start of trading on Monday, Brent crude fell by around 0.6% to $71.71 per barrel, while U.S. West Texas Intermediate (WTI) crude dropped to $68.32 per barrel.

In a recent meeting, OPEC and allied producers including Russia decided to increase production by another 188,000 barrels per day starting in August. Similar increases were also planned for June and July.

Analysts say that the full impact of recent geopolitical tensions has not yet fully reflected in the market. During conflict involving Iran, Israel, and the United States, oil shipments through the Strait of Hormuz were disrupted.

However, as conditions stabilize, exports from the Gulf region have increased significantly. In June, oil exports rose by more than 3 million barrels compared to May, reaching over 10 million barrels per day.

Despite this recovery, exports remain below pre-conflict levels.

Market analysts warn that increasing production could create oversupply pressure. However, lower prices may eventually boost consumption and rebalance the market.

An international bank forecast suggests global oil demand may decline by around 1.5 million barrels per day in 2026, although improvements may occur in the second half of the year if supply stabilizes.

Meanwhile, reports of discounted oil sales from state companies in the UAE and Ukrainian attacks on Russian refineries have added further uncertainty to the global energy outlook.