Oil prices drop after Biden asks OPEC to raise production faster

LONDON (Bloomberg) --Oil dropped suddenly after a report that the U.S. will urge OPEC to revive production more quickly.

Futures tumbled 1.2% in New York as CNBC reported that the White House intends to call on the producer group to help stabilize gasoline prices. Biden administration officials have already contacted OPEC leader Saudi Arabia, as they believe the group’s planned output increases are too slow, CNBC said.

Prices:

• West Texas Intermediate for September delivery fell 1.2% to $67.50 a barrel on the New York Mercantile Exchange at 11:32 a.m. in London.
• Brent for October settlement was 1.1% lower at $69.88 on the ICE Futures Europe exchange, after gaining 2.3% on Tuesday.

The 23-nation OPEC+ alliance led by Saudi Arabia and Russia agreed last month to revive the rest of the production halted during the pandemic in careful installments, of 400,000 barrels a day each month.

Oil prices have softened this month as the Delta variant prompts new lockdowns in China and other key fuel consumers in Asia. Still, many analysts expect global markets will soon tighten as demand begins to pick up again.

Prices gained 2.7% on Tuesday, when the American Petroleum Institute reported motor fuel stockpiles fell by 1.11 million barrels last week, according to people familiar with the data. That would be the fourth weekly draw, the longest run of declines since September, if confirmed by official figures due later Wednesday.