Oil prices dropped on Monday as OPEC+ raised production once more

WTI oil opened on Monday with a \$2 gap lower, reaching its lowest point since April 9, after OPEC+ announced over the weekend that it would increase oil production by 411,000 barrels per day starting in June.

This decision marks the third consecutive production hike, totaling 960,000 barrels per day, with increases seen in April, May, and now June.

The move has put downward pressure on oil prices, as markets remain highly concerned about the outlook for oil demand, worsened by growing fears of a further slowdown in the global economy, already impacted by U.S. trade tariffs.

The pressure on oil prices may intensify amid worries that these additional production increases could undo the impact of OPEC+’s earlier voluntary production cuts, potentially deepening the imbalance between supply and demand.

Oil prices neared key support at \$55.12 (the April 9 low, the lowest since February 2021), but this level faces significant resistance, which may lead to a period of consolidation before a possible further decline.

Bears are expected to maintain control as long as today’s gap remains unfilled, though any potential rallies (which cannot be ruled out) should ideally be capped below \$60.00 (50% retracement of the \$64.70-\$55.14 decline, reinforced by daily Tenkan-sen) to keep the near-term outlook bearish.

Daily indicators remain bearish, with strong negative momentum and a bearish setup between the daily Tenkan-sen and Kijun-sen, further supporting a negative short-term outlook.

Res: 57.11; 57.66; 58.79; 60.00
Sup: 55.12; 54.77; 52.43; 51.59