Oil slips towards $75 as threat of OPEC boost weighs

LONDON, May 30 (Reuters): Oil slipped towards $75 a barrel on Wednesday, under pressure from expectations OPEC and its allies will pump more and as Italy's political crisis increased investors' aversion to risk.

Global benchmark Brent crude has dropped $5 from a 3 1/2-year high of $80.50 a barrel on May 17, after reports that OPEC and Russia may increase supply at a June meeting, reversing policy after 17 months of cutting supplies.

Brent LCOc1 was down 3.0 cents at $75.36 a barrel by 0842 GMT, after trading as low as $74.81 earlier. US crude CLc1 was up 3.0 cents at $66.76.

"Take the specter of rising production from OPEC/non-OPEC and throw in a generous sprinkling of eurozone political turmoil and what do you get? In short, an exodus of oil bulls," said Stephen Brennock of oil broker PVM.

"A dearth of bullish catalysts will make hard work of any recovery."

Political turmoil in Italy has rocked financial markets, sending the euro to a 10-month low against the dollar on concern that a snap election would lead to a eurosceptic government in Rome.

A stronger dollar makes dollar-denominated commodities more expensive for holders of other currencies and tends to weigh on oil prices.

The Organisation of the Petroleum Exporting Countries and non-OPEC producers led by Russia have had a pact to curb output by about 1.8 million barrels per day since January 2017.