LONDON, Sept 3 (Reuters): Oil prices fell by about 2 per cent on Wednesday ahead of a weekend meeting of OPEC+ producers that is expected to consider another increase in production targets in October.
Brent crude fell $1.09, or 1.6 per cent, to $68.05 a barrel by 1310 GMT. US West Texas Intermediate crude fell $1.16, or 1.77 per cent, to $64.43 a barrel, having fallen 2 per cent earlier.
Eight members of the Organization of the Petroleum Exporting Countries and allies - known as OPEC+ - will consider further raising oil production at a meeting on Sunday, two sources familiar with the discussions told Reuters, as the group seeks to regain market share.
Another boost would mean that OPEC+, which pumps about half of the world's oil, would be starting to unwind a second layer of output cuts of about 1.65 million barrels per day, or 1.6 per cent of world demand, more than a year ahead of schedule.
The group had already agreed to raise output targets by about 2.2 million bpd from April to September, in addition to a 300,000 bpd quota increase for the United Arab Emirates.
"If output is raised in line with new quotas, we see the market moving into a sizeable surplus from September 2025 through 2026, with inventories building unless countered by renewed restraint," said Ole Hvalbye, an analyst at SEB bank.
"Futures for 2026 trade between $65-$66 a barrel, implying market confidence that OPEC+ will eventually reimpose cuts. We share this view, though we see downside risks first as production rises and prices soften into year-end."
Actual increases from the group, however, have fallen short of its pledges as some members compensated for previous over-production and others struggled to raise output due to capacity constraints.
The oil benchmarks settled up more than 1 per cent in the previous session after the US imposed new sanctions on a network of shipping companies and vessels led by an Iraqi-Kittitian businessman for smuggling Iranian oil disguised as Iraqi oil.
Meanwhile, US crude oil stockpiles were expected to have fallen last week, along with distillate and gasoline inventories, a preliminary Reuters poll of three analysts showed on Tuesday.
But soft economic data kept prices capped.
