• WTI Oil has fallen to the $70 level as rumors OPEC is preparing to ramp up production lead traders to press sell. 
• A slowdown in Chinese demand and weak Manufacturing figures further weigh. 
• Mixed US inventory data, Libyan outages and possible Federal Reserve cuts are further factors.  

West Texas Intermediate (WTI), the US crude Oil benchmark, is declining sharply into the $70.50s, down over 4.0% on Tuesday, as rumors of OPEC production cuts and concerns around slowing China demand weigh on the black gold.    

Six sources from inside the Organization of the Petroleum Exporting Countries (OPEC) and its allies recently told Reuters the organization is planning to increase production from October. 

“Eight OPEC members are scheduled to boost output by 180,000 barrels per day (bpd) in October as part of a plan to begin unwinding their most recent supply cuts of 2.2 million bpd while keeping other cuts in place until the end of 2025,” said Reuters. 

The production increases come as OPEC struggles to compete with US shale producers. By increasing the output of its members it hopes to push down the price of Oil until it is at or below the cost of production of shale, thereby eroding shale companies’ profit margins.