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Fears over Saudi Arabia, Russia possible glut draw down oil price

Oil prices inched down on Wednesday amid concerns that Saudi Arabia and Russia will pump more crude in the second half of the year in response to falling global crude inventories and rising consumer prices. Saudi Arabia and Russia have discussed raising OPEC and non-OPEC oil production by 1 million barrels per day (bpd) to counter potential supply shortfalls from Venezuela and Iran.

Brent crude LCOc1 was down 45 cent, or 0.6 percent, at $74.94 a barrel at 0325 GMT, after settling up 9 cents on Tuesday.

U.S. West Texas Intermediate crude CLc1 was down 24 cents, or 0.34 percent, at $66.49 a barrel. It had settled down $1.15. “OPEC has over-delivered on supply cuts in the past six months,” Harry Tchilinguirian, global head of commodity market strategy at French bank BNP Paribas, said in a note to clients.

“There is … scope for an increase in OPEC output.” OPEC-led supply curbs have largely cleared an inventory surplus in industrialized countries, and stocks continue to decline. The Organization of the Petroleum Exporting Countries is due to meet in Vienna on June 22.