Oil prices ease after Russia says it may gradually raise output

Oil prices eased on Friday as Russia hinted it may gradually increase output after withholding supplies since 2017 together with producer cartel OPEC.

Brent crude futures were at $78.78 per barrel at 0024 GMT, down 1 cent from their last close, but more than 2 percent below the $80.50 November 2014 high they reached on May 17. Brent broke through $80 for the first time in a few years earlier in May.

U.S. West Texas Intermediate (WTI) crude futures were at $70.69 a barrel, down 2 cents from their last settlement.

"Oil prices are now starting to drift a little," said Greg McKenna, chief market strategist at futures brokerage AxiTrader, adding that this was due to OPEC`s and Russia`s "moves toward an increase in production at the June meeting".

The Middle East dominated Organization of the Petroleum Exporting Countries (OPEC) as well as a group of non-OPEC producers led by Russia started withholding output in 2017 to tighten the market and prop up prices.

But Russia, in particular, has been floating a potential end to the production cuts, with energy minister Alexander Novak saying on Thursday that restrictions on oil production could be eased "softly" if OPEC and non-OPEC countries see the oil market balancing in June.

"The Russians have always struck me as production cut tourists keen to get off the boat and crank up production as soon as inventories were stabilised and prices once again elevated ... That possibility is top of the mind for traders and as a result oil prices are slipping," McKenna said.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)