Oil prices took a dive Friday morning with in the biggest weekly drop since May. Investors fear that the Organization of the Petroleum Exporting Countries and its OPEC+ allies will most likely will boost supply with more barrels due to expectations of rising demand as many nations shake off the pandemic, writes Reuters.

Friday morning, European reference oil Brent costs USD 73.40 (EUR 62.21) against USD 74.24 Thursday afternoon. US benchmark crude West Texas Intermediate (WTI), trades at USD 71.58 against USD 72.60 Thursday afternoon.

Discussions in OPEC+ ended without an agreement earlier this month when the United Arabic Emirates (UAE) opposed extending the output curb policy until after April 2022.

However, UAE and Saudi Arabia reached a compromise this week, paving the way for OPEC+ to finalize a deal that would increase supply in the market.

"All signs indicate that OPEC+ is heading for a potential compromise agreement that will allow the UAE to secure a baseline adjustment. Other producers will undoubtedly seek similar treatment and potentially prolong the deliberations heading into the August ministerial meeting," writes RBC Capital, according to Reuters.

OPEC said on Thursday that oil demand is expected to increase next year to the same levels as before the pandemic.

English Edit: Christoffer Østergaard

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