By Bryan Wong
Investing.com- Oil was down on Monday morning in Asia, ahead of OPEC’s technical meeting on Wednesday. Investors are expecting OPEC to recommend an easing in existing supply cuts that could reverse oil gains.
“The planned easing of OPEC+ production cuts next month and a potential rebound in U.S. production could add pressure on the supply side of the equation,” Stephen Innes, chief global markets strategist at AxiCorp warned in a note.
Brent oil futures dropped 0.74% to $42.92 by 11:58 PM ET (4:58 AM GMT) while WTI futures slid 0.81% to $40.22.
Oil was up more than 2% on Friday after the International Energy Agency revised its 2020 oil demand upwards by 400,000 barrels per day. However, a worsening COVID-19 situation globally on top of the upcoming OPEC meeting saw the black liquid reverse Friday’s gains.
There was also a record increase in global COVID-19 cases on July 12 with a total of 230,370 new cases in 24 hours, according to the World Health Organization (WHO). The hardest hit countries include some of the largest oil consumers such as the U.S., Brazil, India and South Africa, which is expected to further dampen demand.
Investors are also looking to the American Petroleum Institute (API)’s upcoming estimate of crude oil supply on Tuesday to assess the risk of an oversupply.