By Yuka Obayashi

TOKYO, Reuters – Oil prices dropped Monday as China announced that it has released gasoline and diesel reserves to increase supply. Investors also unwound long positions in advance of the OPEC+ meeting Nov. 4.

China’s National Food and Strategic Reserves Administration announced on Sunday that it had released fuel reserves to support market supply and stabilize prices in certain regions.

Futures fell 20 cents or 0.2% to $83.52 per barrel at 0039 GMT on Friday, following a gain of 6 cents.

U.S. West Texas Intermediate crude oil futures fell 37 cents or 0.4% to $83.20 per barrel after rising 76cs Friday.

These benchmarks were slightly lower last week. It was Brent’s eighth consecutive weekly decrease and WTI’s 10th consecutive decline.

Hiroyuki Kukawa, Nissan’s general manager for research (OTC:) Securities stated that “investors are adjusting their positions following the news about China’s fuel reserve release and before the OPEC+ meeting.”

With analysts anticipating that they will stick with their December plan of adding 400,000 barrels to the supply, all eyes are now on the Organization of the Petroleum Exporting Countries’ (OPEC+) meeting of Russia, Russia and its allies.

The decision of OPEC+ not to increase its output due to concerns about global supply, rather than maintaining it, saw oil prices rise to new multi-year highs.

Kikukawa explained that “some investors wish to square their positions due to the possibility that OPEC+ would decide a greater increase in output”, and that they will continue buying once the OPEC decision is confirmed.

The U.S. Commodity Futures Trading Commission said Friday that money managers had reduced their net positions in options and long futures for the week up to Oct. 26.

U.S. President Joe Biden demanded Saturday that major G20 oil producing countries increase their output to support a global economic recovery. This was part of a wide effort to push OPEC and other partners to increase oil supply.

SOMO, Iraq’s national oil marketing organization, stated that the country does not need to decide to expand its production beyond what is planned for OPEC members.

U.S. Energy Firms added oil and drilling rigs to fuel rising oil prices in October. They have now reached their highest point since April 2020, Baker Hughes Co energy services firm said.

Exxon (NYSE 🙂 Chevron After cutting down on output and crews last year in the Permian region, companies announced Friday that they are now looking at adding drilling rigs to the Permian basin. Chevron announced that it would add two drilling crews to its Permian shale basin operations this quarter.