Oil prices fell on Thursday as traders digested major producers' latest decision on output.
The West Texas Intermediate for August delivery lost 4.02 U.S. dollars, or 3.7 percent, to settle at 105.76 dollars a barrel on the New York Mercantile Exchange. Brent crude for August delivery decreased 1.45 dollars, or 1.2 percent, to close at 114.81 dollars a barrel on the London ICE Futures Exchange.
Based on the front-month contracts, the U.S. crude standard and Brent lost 7.8 percent and 6.5 percent, respectively, for the month of June, but both crude benchmarks rallied more than 40 percent year to date, according to Dow Jones Market Data.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, collectively known as OPEC+, said on Thursday that they would stick to a previously decided output boost in August.
At its last meeting in early June, OPEC+ decided to advance the planned output increases of 432,000 barrels per day (bpd) for September and redistribute it equally to the previous two months, thus raising production by 648,000 bpd in July and August.
The group has yet to decide on new production targets for September and beyond.
"The increase in production in August would serve to reverse all of the production cuts implemented in May 2020, at least on paper - though in reality OPEC+ is still a long way from achieving this," Carsten Fritsch, energy analyst at Commerzbank Research, said Thursday in a note, adding "what is more important is what will happen next."