Oil prices have dropped today as OPEC production continues to increase. The prices dropped after traders earned profits for eight days spurred by signs of slowdown in US.
Brent crude futures LCOc1, now dropped by 15 cents to touch at $49.53 per barrel while US West Texas Intermediate (WTI) crude futures CLc1 dropped 12 cents at $46.95 a barrel.
In May and most of June, US production increased and there were concerns about whether the Organization of the Petroleum Exporting Countries’ (OPEC) cut can withhold the price from dropping down further.
However, the concerns eased toward the end of June as US data indicated a drop in production as well as in drilling activities.
Commerzbank was quoted by Reuters as saying: "The fact that prices have not come under any noticeable pressure of late points to a shift in sentiment.
"This may be related to the fact that most of the 'shaky hands' have withdrawn from the market by now."
OPEC’s efforts to curtail price decline have been undermined by growing output from Libya and Nigeria, which have been exempted from the cuts.
Currently, Libya’s crude production is around one million bpd, which is a high in four years.
According to a report by Thomson Reuters Oil Research, OPEC exports increased for the second month in a row in June to touch at 25.92 million bpd, an increase of 1.9 million bpd compared with the same month last year.