Oil prices have declined as the producers group The Organization of the Petroleum Exporting Countries (OPEC) is on the verge of reaching an agreement to raise crude output following months of supply cuts.

Brent crude LCOc1 dropped 60 cents per barrel to reach $74.14, while US light crude CLc1 went down 35 cents to stand at $65.36, Reuters reported.

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Last month, Brent hit a three-a-half-year high, breaching the $80 a barrel level.

Since then, the benchmark crude has fallen steadily as Saudi Arabia, de facto leader of OPEC, and Russia are inclined towards increasing production to maintaining prices.

OPEC is set to hold its biannual meeting in Vienna, Austria, on 22 June and will potentially decide to raise output.

Iran has turned around to the possibility of supporting a small increase from its previous stance of opposition to any increase in production.

French bank BNP Paribas oil strategy head Harry Tchilinguirian was quoted by the news agency as saying: “It would seem that an aggregate increase in production for OPEC of between 500,000 barrels per day and one million barrels per day is the range that is being considered.”

“It would seem that an aggregate increase in production for OPEC of between 500,000 barrels per day and one million barrels per day is the range that is being considered.”

OPEC and other producers began supply cuts in January last year to tighten the market.

Oil prices are also being impacted by rising trade war between the US and other countries, including China and India.

China threatened to impose a 25% duty on US crude oil imports after Washington indicated a potential tariff on products imported from China.

On 20 June, the Chinese Government ordered China Energy Investment executives not to visit West Virginia to discuss a planned $83.7bn investment in the state.

Meanwhile, India increased import tariffs on various products imported from US.

However, oil prices have generally received support from global demand.

The Energy Information Administration (EIA) indicated that US refineries processed a seasonal record last week of 17.7 million barrels per day of crude oil, while commercial US crude inventories declined by 5.9 million barrels in the week ending 15 June, to touch 426.53 million barrels C-STK-T-EIA.