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Dow Jones NewsJun 2, 1:21 PM UTC
DJ Why Oil Prices Are Jumping After OPEC Increased Production -- Barrons.com
By George Glover
Oil prices were surging on Monday, driven higher by a flare-up in tensions between Russia and Ukraine and an output hike by the OPEC+ cartel of producers.
The Brent international benchmark jumped 4% to $65.26 a barrel, and West Texas Intermediate U.S. prices jumped 4.4% to 63.47 a barrel.
Crude was rallying after Ukraine launched drone attacks on four military airports in Russia, destroying more than 40 warplanes. Geopolitical shocks have tended to trigger short-term oil spikes in recent years, although concerns about waning global demand have kept a lid on prices.
Events in Eastern Europe weren't the only factor driving oil prices higher. OPEC+ agreed to hike production by 411,000 barrels a day, upping its output -- something that would typically cause prices to fall given the increase in supply -- but by less than some market participants had feared. "Despite some jawboning last week about a steeper increase, the group appears committed to unwinding voluntary cuts at a steady pace through midyear, placing growing pressure on balances in 2H25," writes Evercore ISI analyst Stephen Richardson.
Shares in oil majors were edging higher Monday. Chevron stock climbed 1.3% and Exxon Mobil stock rose 1.5% ahead of the U.S. opening bell. Futures tracking the S&P 500 were down 0.4%.
Write to George Glover at george.glover@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
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June 02, 2025 09:21 ET (13:21 GMT)
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