Oil prices tumbled on Friday as production from OPEC rose for the first time this year and Russia’s output missed its agreed production levels.
New York-traded West Texas Intermediate crude futures dove $1.66, or 2.9%, to $55.05 a barrel by 11:58 AM ET (15:58 GMT), while Brent crude futures, the benchmark for oil prices outside the U.S., slid $1.58, or 2.6%, to $58.91.
OPEC oil output increased in August for the first time in 2019, according to a Reuters survey, which blamed higher supply from Iraq and Nigeria.
The survey showed that the cartel pumped 29.61 million bpd this month, an increase of 80,000 bpd from July.
OPEC and major oil producing allies led by Russia agreed in June to extend its pact - to reduce supply by 1.2 million barrels per day - to March 2020.
The Joint Ministerial Monitoring Committee, which oversees the production agreement, said this week that compliance on that agreement was actually at 159%.
But the survey suggested that Saudi Arabia's efforts to cut by more than the required amount may be insufficient to effectively curtail supply.
Adding to the issue, Russian oil minister Alexander Novak admitted that Moscow's cuts in production would not meet the levels outlined in its agreement with OPEC to reduce supply, according to a report from RIA.
Earlier in the session Interfax had reported that Russia’s production increased to 11.3 million barrels per day in August from 11.148 million in the prior month.
Novak did say that Moscow is aiming for full compliance with the deal despite the slight increase, according to Interfax.
The Russian oil minister added that OPEC and non-member countries would discuss both the deal and the market situation at the regularly scheduled monitoring meeting on Sept. 12.
Providing some hope for oil bulls, markets are bracing for the arrival in Florida of tropical storm Dorian this weekend.