• WTI backslid to $74.00 per barrel after OPEC failed to bolster Crude trader hopes.
• Voluntary production cuts are slated to be phased out beginning in October.
• OPEC voluntary cuts have kept 2.2 million bpd off the market since 2022.

Crude Oil prices tumbled on Monday after an update on voluntary production cuts didn’t go how energy traders had hoped last week. The Organization of the Petroleum Exporting Countries (OPEC) and its extended network of non-member allies, OPEC , announced the beginning of a phase-out of long-running production caps. The phase-out is slated to begin in October.

OPEC has been participating in voluntary Crude Oil production cuts that have kept 2.2 million barrels per day off the markets in an attempt to bolster global barrel prices in the face of global Crude Oil output that has grown to outpace demand. However, key members of OPEC who rely on selling Crude Oil in order to balance their government budgets have balked at the idea of continuing to support global prices at the expense of their solvency, and are set to begin phasing out currently-standing production limits sometime in October. OPEC stipulated that ending production limits will be data-dependent heading closer to October, but energy traders promptly sold off Crude Oil as barrels slated for year-end delivery become an unappealing bet.

US Crude Oil traders will be looking ahead to weekly updates on barrel counts from the American Petroleum Insitute (API) and the Energy Information Administration (EIA), due on Tuesday and Wednesday, respectively. Last week’s updates showed a sharp pullback in Crude Oil supplies, but inventories in upstream refined Crude Oil products spiked after a widely-expected uptick in US Crude Oil demand at the beginning of the Memorial Day driving season failed to materialize, leaving refineries with far more inventory than expected.