Oil prices rose ahead of the OPEC+ meeting this week

Oil prices rose in early Asian trade on May 31, underpinned by the bright outlook for fuel demand growth in the following quarter. Meanwhile, investors looked ahead to the OPEC+ meeting this week to see how producers will respond.

Brent crude futures for August gained 0.7%, which equals 50 cents and settled at $69.22 a barrel after hitting their highest in two years on Friday. Meanwhile, U.S. West Texas Intermediate crude for July increased by 55 cents or 0.8% and traded at $66.87 a barrel.

U.S. and U.K. markets are closed on May 31 due to public holidays.

Both contracts are on track for a second monthly gain as analysts anticipate oil demand growth to surpass supply despite the possible return of Iranian crude and condensate exports.

ANZ analysts say they see demand outstripping supply in the order of 650,000 barrels per day and 950,000 BPD in Q3 and Q4, respectively, adding that this includes 500,000 BPD of boost in Iranian output.

The OPEC+ is anticipated to gradually ease Oil supply cuts until July

The Organization of the Petroleum Exporting Countries (OPEC) and their allies, including Russia, will meet on Tuesday.

The OPEC+ is anticipated to stay the course on its plans to gradually ease supply cuts until July.

According to the Energy Information Administration, crude output in the United States rose 14.3% in March. Baker Hughes data showed oil and gas rigs increasing for a 10th month in a row last week.

EIA’s data also revealed that a cargo of 1.033 million barrels of Iranian crude oil was recorded as landing on U.S. shores in March, the first shipment of Iranian oil to the America since 1991.

However, data published earlier in the day in Asia said China’s manufacturing Purchasing Managers Index for May declined to 51.0. The non-manufacturing PMI stood 55 in May, slightly higher than April’s 54.9 figure. The mixed data raised concerns that the rebound in manufacturing in the world’s biggest importer of crude oil globally might be slowing down.