Oil at $68.22 as OPEC+ Likely to Add 188K bpd in August

OPEC+ will meet Sunday and is expected to raise output quotas by 188,000 barrels per day for August, Reuters reported. The increase continues the gradual monthly unwinding of voluntary production cuts. Assuming the group delivers the expected amount, it stays on track to restore the remaining voluntary cuts over the coming months.

Oil prices have already moved ahead of the decision. Crude fell to a new cycle low of $68.22, the lowest level since the Iran conflict began in late February. WTI settled at $67.28 on February 27, the day before the conflict started. The geopolitical risk premium has largely unwound.

At the pump, the pass-through has been slower. The latest AAA national average for regular gasoline is $3.84 per gallon, compared with roughly $2.98 around the start of the conflict. President Trump has repeatedly called on retailers to pass lower crude prices to consumers faster. Lower gasoline prices are a key part of his economic agenda. By comparison, the national average at the end of President Biden's term was about $3.11 per gallon.

From a chart perspective, sellers remain in control. To shift the near-term bias back toward buyers, crude needs to reclaim the 100-hour moving average at $70.13. Above that, the 200-hour moving average at $71.89 and the 200-day moving average at $73.91 act as resistance. Until those barriers break and sustain, the path of least resistance is down.

The weaker-than-expected ADP data pulled stock indices lower. The NASDAQ fell 112 points. The S&P 500 dropped 14 points. The Dow lost 56 points. The oil decline adds to a risk-off tone.

Sunday's meeting will decide the August quota path. The market is already pricing the increase, leaving compliance and technical resistance as the main watchpoints. The first test is $70.13. A failure to reclaim that level keeps crude on the defensive.