Oil drops after White House says OPEC should increase production

The OPEC logo pictured ahead of an informal meeting between members of the Organization of the Petroleum Exporting Countries (OPEC) in Algiers, Algeria.

Ramzi Boudina | Reuters

Oil prices fell on Wednesday after the White House called on OPEC and its allies to increase oil production to support the global recovery from the pandemic.

West Texas Intermediate crude futures traded down 0.85% to $ 67.73 per barrel. Earlier in the session, the contract was trading as high as $ 66.67 per barrel.

International benchmark Brent crude slipped 0.82% to $ 70.05.

Oil prices fell on Wednesday after CNBC reported that the White House said OPEC + must increase production.

“Competitive energy markets will ensure a reliable and stable energy supply, and OPEC + must do more to support the recovery,” National Security Advisor Jake Sullivan said in a statement obtained by CNBC.

The group agreed in July to increase production by 400,000 barrels per day, but that would leave production well below pre-pandemic levels. OPEC + cut production by 10 million barrels per day in mid-2020. US producers have also cut production due to the sharp drop in demand.

The White House said the July deal was “just not enough”.

In recent months, consumer gas prices have soared in the United States as the economy reopens. The Biden administration is also asking the Federal Trade Commission to monitor the domestic market for potential illegal activity that could add to the price hike.

The national average for a gallon of gasoline stood at $ 3,186 on Tuesday, according to AAA, up just over $ 1 last year.

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