The 23-country OPEC+ coalition enacted a 9.7 million b/d production cut accord in May in response to the coronavirus crisis, but will roll the deal back to 7.7 million b/d in August through to the end of the year, maintaining the terms of the agreement laid out in April.
EIA reported a larger-than-expected draw in US' crude oil stocks.
Oil prices slipped on Friday amid growing uncertainty about the recovery in fuel demand as COVID-19 cases surged in several countries.
Good news is for the OPEC members however, as the OPEC has forecast that the demand for its crude will grow by around 25 percent. year-on-year - higher than the level in 2019 - due to recovery in global oil demand and limited production growth for U.S. in 2021. Fears remain however of a second wave of COVID-19, highlighted recently by new lockdowns in some U.S. states, which would crimp economic activity and stall the nascent recovery.
"China does not need additional barrels for September, instead it has to destock and digest the heavy arrivals in May-July", a Beijing-based analyst said.
OPEC+ plans to add at least one million barrels a day of output to the market in August after nearly three months of historic curbs to ease the impact of the pandemic.
State-rin oil marketing companies (PSU OMCs) were in demand after OPEC+ agreed to ease record supply curbs. The global organization expects world oil demand to rebound by 7 million barrels a day, or 7.7 percent in 2021 to 97.72 million a day.
However, its monthly motor fuel consumption is unlikely to recover above 8.2 million barrels as long as the pandemic persists, according to traders and fuel marketing sources at major South Korean refiners SK Innovation, S-Oil Corp., GS Caltex and Hyundai Oilbank surveyed by S&P Global Platts.
Gasoline inventories decreased by 3.1 million barrels, or 1.3%, to 248.5 million barrels over that period.
Commercial crude oil inventories in the U.S. fell by 7.5 million barrels, or 1.4%, to 531.7 million barrels for the week ending July 10, the data showed. Spot crude oil prices have continued to rise in May and June 2020 as inventories have gradually come down.