Oil prices fell in early Asian trading on Thursday after uncertainty that the United States will avoid a debt default weighed against the prospect of further OPEC+ production cuts. Brent crude futures slipped 5 cents, or 0.1%, to $78.31 a barrel by 0042 GMT. U.S. West Texas Intermediate crude (WTI) fell 16 cents, or 0.2%, to $74.18.
Some progress had been made but several issues remained unresolved in U.S. debt ceiling negotiations, House Speaker Kevin McCarthy said Thursday, as the deadline ticked closer to raise the federal government’s $31.4 trillion borrowing limit or risk default. Negotiators for Democratic President Joe Biden and top congressional Republican Kevin McCarthy reconvened Wednesday at the White House to try to close a deal.
Some investors took that as a signal that the Organization of Petroleum Exporting Countries and allies including Russia, together called OPEC+, could consider further output cuts at a meeting on June 4. Oil was also supported by an unexpected, massive fall in U.S. crude oil inventories in the week to May 19, reported by the Energy Information Administration on Wednesday.