Oil prices in international markets recorded a slight decline on Monday. Brent crude oil fell to $71.09 during the day, its lowest level since February, before trading at $71.87, down 0.15 percent.
Two main developments stood out in the price decline: the OPEC+ countries' decision to increase production and the rise in the number of oil tankers passing through the Strait of Hormuz following the US-Iran ceasefire.
OPEC+ increases production
The OPEC+ group decided in a virtual meeting on Sunday that Saudi Arabia, Iraq, Kuwait, Oman, Algeria, Russia and Kazakhstan would increase daily production by 188,000 barrels starting in August. This was the fifth consecutive increase decision as the group gradually ends the cuts it began in 2023.
OPEC+ includes members of the Organization of the Petroleum Exporting Countries (OPEC) as well as allied producers such as Russia, Bahrain and Oman.
Strait of Hormuz traffic recovers
Maritime traffic in the Strait of Hormuz, through which about one-fifth of global oil and liquefied natural gas shipments pass, is gradually returning to normal after the US-Iran memorandum of understanding signed on June 17. During the conflict, Tehran's disruption of navigation in the waterway and its targeting of the US, Israel and Gulf countries had caused oil prices to climb to $115 per barrel in early May.
Although occasional violations and attacks on ships have occurred since the ceasefire, vessel transits are steadily increasing. According to LSEG data, 10 Japan-linked ships exited the strait on Monday, while a supertanker carrying Saudi oil set sail for South Korea over the weekend.
Meanwhile, crude oil production by the United Arab Emirates, which left OPEC on May 1, exceeded 3.8 million barrels per day in June, approaching a record level.
