Commodities Update

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Oil price declines ahead of OPEC meeting

The oil price fell for the first time in three days as Saudi Arabia maintained crude oil output at a record in May before OPEC meets this week to discuss its production policy. Saudi Arabia pumped in May as much oil as technically possible, matching the highest level in production since 1989. Even Iraq, still suffering the consequences of terrorism and war, increased its output to a record high. Analysts are widely expecting the OPEC to maintain the daily production at 30 million barrels. The strategy of favoring market share over prices could negatively influence the price in the short term. Nevertheless, if the Fracking industry could be squeezed out of the market, the OPEC may influence the price as before the slump of the oil price.