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Oil is crashing as Russia says that it will not offer deeper production

Crude oil fell sharply, ending the longest winning streak this year, as Russia was said to be opposed to any proposal to increase production under the direction of OPEC.

05.Jul.17 2:58 PM
By Daria Zaytseva


Oil is crashing as Russia says that it will not offer deeper production

Futures fell 4.1% in New York, and more in just four weeks, after eight straight sessions of profit. According to state officials, Russia doesn’t want to change the current deal, because any further restrictions on supply will send the wrong message to the market. The U.S. dollar strengthened, reducing the appeal of commodities denominated in the currency. Shares of oil and gas producers were down across the board.

While oil prices rose last week, futures dropped 16 percent for the year amid concern that rising supplies in the world will compensate for the reduced production from the Organization of countries-exporters of oil.

West Texas Intermediate for August delivery settled $1.94 lower at $45.13 a barrel on the New York Mercantile Exchange. Tuesday’s transactions will be booked Wednesday for settlement purposes because of the U.S. Independence Day holiday. Prices gained almost 11 percent in the eight days through Monday.

Brent for September settlement closed at $47.79 a barrel on the London’s ICE Futures Europe exchange, down $1.82. The contract fell 0.1 percent to $49.61 on Tuesday, the first decline in nine sessions.

The deepening of the reduction would suggest that OPEC, Russia and their allies are nervous that the pact to reduce output by a combined 1.8 million barrels a day through March 2018 isn’t doing enough to support prices, one of the Russian officials said.

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