Oil prices fall as output cut optimism fades quickly (June 6)

Oil prices edged lower after Saudi Arabia unexpectedly pledged to further cut output. WTI crude oil fell below $72/barrel, and the market sentiment is cautious. Saudi Arabia pledged to take “all necessary measures” to stabilize the market as the demand outlook weighed on oil prices. Crude prices fell 11% last month on strong output from Russia, even as OPEC+ producers said earlier this year that they would reduce supply. Sean Lim, an oil analyst at RHB Investment Bank, said the OPEC+ meeting reaffirmed its commitment to provide stability, but the outcome of the meeting would have minimal impact on the oil market.