The commodities feed: Oil falls after latest OPEC+ supply hike

Oil prices are trading weaker this morning after OPEC+ agreed on another large supply hike for September.

Energy – OPEC+ goes with another large supply hike for September

There was little in the way of surprises from OPEC+ over the weekend, as the group increased supply by 547k b/d for September. The market had largely expected the supply hike, one that marks the end of the group returning the full 2.2m b/d of additional voluntary cuts. We believe the group is finished with its supply hikes, as we move out of the stronger summer demand period and inventories start to rise.

However, much also depends on what happens to Russian oil flows. The Trump administration threatens penalties on India for purchasing Russian energy. This puts in the region of 1.7m b/d of supply at risk if Indian refiners stop buying Russian oil. If there are no other willing buyers for this oil, it would erase the expected surplus through the fourth quarter and 2026. It would also possibly provide OPEC+ the opportunity to start unwinding the next tranche of supply cuts totalling 1.66m b/d.

So far, the US has threatened penalties on India. Less has been said about the flow of Russian oil to China. If the US successfully targets these flows as well, it will leave the market considerably tighter and require OPEC+ to tap even deeper into its spare production capacity.

Concerns over the US imposing secondary tariffs on countries that import Russian oil have speculators becoming more constructive towards the market. The managed money net long in ICE Brent increased by 33,959 lots to 261,352 lots. This was driven fairly evenly by fresh buying, along with short covering. Speculators remain supportive towards middle distillates, increasing their net long in ICE gasoil by 2,464 lots to 100,644 lots as of last Tuesday, the largest position held since March 2022. However, the next release may show a reduction in positioning, given the sell-off we’ve seen in the gasoil crack since last Tuesday.

Rig activity in the US continues to decline despite oil prices finding better support in recent months. The oil rig count fell by five over the last week to 410. This is the fourteenth consecutive week of declines, a period during which the number of active rigs has fallen by 65. While this decline may surprise the market with prompt West Texas Intermediate (WTI) prices trading near $67/bbl, producers will be looking further along the curve. For example, 2026 WTI prices are trading sub-$64/bbl.

Metals – Copper drops after Trump’s tariff surprise

LME copper was down 1.4%, while prices on the Comex exchange plunged more than 20% last week after President Trump’s decision to exempt refined forms of the metal from fresh US import tariffs. Just last week, futures in New York surged to an all-time high. A significant premium for New York futures over London evaporated. A week ago, that premium reached over 30%. The collapse of an arbitrage trade has left the US with a huge buildup of copper stockpiles. Copper inventories at Comex warehouses are at their highest in 21 years. That stockpile might now be re-exported. This will be bearish for LME prices with more copper showing up in LME warehouses.

Trump imposed 50% tariffs on semi-finished copper products, such as pipes, rods, sheets, and tubes, and copper-intensive goods like pipe fittings, cables, connectors, and electrical components, effective last Friday. But, he exempted less-processed goods, including ore, concentrates, cathodes and anodes.

Agriculture – Ukraine grain harvest declines

Data from Ukraine’s Agriculture Ministry shows that farmers harvested grain and legumes at a slower pace in 2025/26, reaching around 15.5mt as of 1 August, compared to 25.3mt (-39% year over year) over the same period last year. The decline in the harvest largely reflected a decrease in area, which dropped from 7.2m hectares harvested last year to 4.4m hectares (39% of the planted area). These output numbers include wheat, which has seen 11.4mt harvested, down from 19.4mt seen at the same stage last year.

The latest CFTC data shows that money managers increased their net short position in CBOT wheat by 13,283 lots to 65,324 lots as of 29 July. The move was dominated by rising short positions. Similarly, the net speculative short in CBOT soybeans rose by 25,445 lots to 36,311 lots. Net shorts in CBOT corn increased by 3,820 lots to 181,185 lots.

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