Brent crude was down $2.08, or 1.8%, at $114.21 a barrel and U.S. WTI crude dropped $2.25, or 2.0%, to $113.01 a barrel
Oil prices fell on Thursday as investors cashed in on a recent rally ahead of a key producers meeting later in the day, with some speculation that Saudi Arabia may boost oil production in response to urging by the United States.
Brent crude was down $2.08, or 1.8%, at $114.21 a barrel at 0410 GMT, having risen 0.6% the previous day.
U.S. West Texas Intermediate (WTI) crude dropped $2.25, or 2.0%, to $113.01 a barrel, after a 0.5% rise on Wednesday.
The benchmarks have marched higher for several weeks as Russian exports have been squeezed by EU and U.S. sanctions against Moscow over its invasion of Ukraine, actions that Russia calls a “special operation”.
While China’s gradual emergence from strict COVID-19 lockdowns has added to price support, speculation that Saudi Arabia may step up production weighed on the market, said Tsuyoshi Ueno, senior economist at NLI Research Institute.
Investors unwound long positions to wait and see whether Saudi Arabia would raise production more quickly to respond to calls from the United States for it to do so, and whether the increase would affect the global supply-demand balance, he said.
Saudi Arabia is prepared to raise its oil production if Russia’s output falls substantially because of the Western sanctions imposed on it, the Financial Times reported on Wednesday, citing sources.
Production increases scheduled for September would be brought forward to July and August, the paper said.
Still, others expect OPEC+ – a grouping of the Organization of the Petroleum Exporting Countries (OPEC) and associated allied producers, including Russia – will keep its production policy unchanged.
Five OPEC+ sources said on Wednesday that OPEC was set to stick to its modest monthly increases in oil output, despite seeing tighter global markets.
