U.S. oil drops 5% to below $70 as OPEC prepares to boost production, Covid concerns weigh

U.S. oil drops 5% to below $70 as OPEC prepares to boost production, Covid concerns weigh

Fell below the key $70 level Monday for the first time in more than a month as OPEC and its allies agreed to raise output, and as the delta Covid variant threatens global demand. U.S. oil dropped more than 6% to hit a session low of $67.21 for its biggest one-day decline since March. The contract is now nearly 12% below its recent high of $76.98 from July 6, which was the highest level in more than six years. International benchmark dipped 5.4% to trade at $69.63 per barrel. The group of 23 nations, known as OPEC+, to increase production by 400,000 barrels each month beginning in August. The output hike will continue through September 2022, at which point the entirety of the nearly 6 million barrels per day the group is still withholding will be back on the market. The announcement came after the group's initial meeting July 1 fell apart amid a disagreement between Saudi Arabia and the United Arab Emirates over the latter's baseline production quota. "We view [Sunday's] deal as supportive to our constructive oil price view with supply increasingly becoming the source of the bullish impulse and evidence of non-OPEC supply shortfalls likely in the