Market News

By Mia Gindis and Alex Longley

(Bloomberg) -- Oil fell to the lowest closing price this year after the breach of a key technical level accelerated losses driven by the possibility of increased flows from Iraq, weakening the prospects of supply constraints that have gripped the market recently. 

West Texas Intermediate slid almost 3% to end the session at $70.40 a barrel, the lowest settlement price since Dec. 26. The drop deepened after prices dipped below their 100-day moving average of about $71.51. Crude has now fallen for five straight weeks, the longest streak in more than a year. 

Crude has been trapped in a roughly $5 range for the past three weeks because of an uncertain outlook for supply, including increasing expectations that OPEC+ will delay a planned production increase and a drone attack that threatened Kazakh pipeline flows. At the same time, US President Donald Trump’s rapid-fire tariff actions and other policy decisions have dimmed the outlook for demand and boosted US consumers’ expectations for long-term inflation. 

OPEC+ postponing its 120,000 barrel-a-day output hike — a move delegates are flagging as a possibility — would mark the fourth time the group delayed plans to revive production halted in 2022. At present, the alliance aims to restore a total of 2.2 million barrels a day in monthly increments, starting in April.

“Given prices in the mid-$70s, we continue to anticipate that the producer group postpones the beginning of bringing back withheld oil supply to market,” Citigroup Inc. analysts, including Eric Lee, wrote in a note. “The decision to bring back more oil to market might only come if the US exerts more sanctions pressure on Iran amid potential negotiations.”