US crude futures fall more than $1/bbl on possible OPEC+ output hike

U.S. crude futures fell more than $1 a barrel on Friday on expectations OPEC+ will decide on Saturday to boost oil output for July beyond previous forecasts.

Brent crude futures were down by 34 cents, or 0.53%, at $63.79 a barrel by 1643 GMT. U.S. West Texas Intermediate crude was last down 73 cents, or 1.2%, at $60.21 a barrel, having earlier dropped more than $1 a barrel.

At these levels, the front-month benchmark contracts were headed for weekly losses over 1%.

Prices dipped into negative territory after Reuters reported that OPEC+ may discuss an increase in July output larger than the 411,000 barrels per day rise that the group decided on for May and June.

"What OPEC+ is planning doesn't look particularly supportive for the oil market," said Matt Smith, Kpler's lead analyst for the Americas.

The potential OPEC+ output hike comes as the global surplus has widened to 2.2 million bpd, likely necessitating a price adjustment to prompt a supply-side response and restore balance, said JPMorgan analysts in a note, adding that they expect prices to remain within the current range before easing into the high $50s by year-end.

Phil Flynn, a senior analyst with Price Futures Group, said an online post on Truth Social by U.S. President Donald Trump that seemed to threaten more changes in tariff levels for Chinese imports also put pressure on crude prices.

"Trump's Truth Social message on China failing to observe a truce on tariffs also combined with the Reuters headline to push prices down," Flynn said.

Trump's tariffs were expected to remain in effect after a federal appeals court temporarily reinstated them on Thursday, reversing a trade court's decision a day earlier to put an immediate block on the sweeping duties.

Oil prices were down more than 1% on Thursday and have lost more than 10% since Trump announced his "Liberation Day" tariffs on April 2.

Also pressuring prices, U.S. consumer spending slowed in April, according to data published on Friday.