Oil buckled on concerns of a global glut after OPEC+ agreed to another bumper output increase, adding to supply at a time when demand is challenged by the drag from the trade war.

Global benchmark Brent tumbled by as much as 4.6% toward $58 a barrel as the week’s trading kicked off, while West Texas Intermediate was near $56. The decision by OPEC and its allies was taken at a meeting on Saturday, with the group’s leaders seeking to punish overproducing members including Kazakhstan in a strategy shift that had already sent prices plunging.

The latest hike of more than 400,000 barrels a day from June matched a similar increase announced last month, when the group made the shock decision to bring back triple the planned volume for May. The alliance — led by Saudi Arabia and Russia — has been reversing prolonged output curbs that were meant to support prices, but which cost it market share to rival drillers.

After the meeting, Saudi Arabia signaled further similar-sized increases could follow, according to delegates.

The move by the Organization of the Petroleum Exporting Nations and its allies has stoked bumper trading volumes, with around 182,000 lots of Brent traded across the curve in the first half an hour of the Asian session.

Crude has slumped in 2025, and has returned to near a four-year low hit in April, as US President Donald Trump’s trade war threatened to derail growth, erode investor confidence and undercut energy demand. The dramatic policy pivot by OPEC+ has added momentum to the sustained selloff, which has made oil one of the worst performing major commodities of 2025.

The increase from OPEC+ “simply cannot be absorbed,” said Ajay Parmar, director of oil analytics at ICIS. “Demand growth is weak, particularly with the recent imposition of tariffs,” he said, flagging the “inevitability” of weaker Brent crude prices.

Morgan Stanley reduced price forecasts following the OPEC+ move, predicting $62.50 a barrel for Brent in the third and fourth quarters of 2025, $5 lower than previously seen. The additional supply “adds to the market surplus we already modeled,” analysts including Martijn Rats said in a note.

The decline in energy costs — if sustained — may be welcomed by central bankers, including those at the Federal Reserve, who meet this week to assess policy. Cheaper oil and associated products including diesel and gasoline could offset some of the inflationary impact expected to be driven by tariffs.

President Trump — who is scheduled to travel to the Middle East later this month — had called on OPEC+ to bolster production and help bring down energy prices. At the same time, Saudi Arabia has been seeking to strengthen ties with Washington, which has also been holding talks on a nuclear pact with Riyadh’s political foe and fellow OPEC member, Iran.

On the trade war front, President Trump said he was willing to lower tariffs on China at some point because the levies now are so high that the world’s two largest economies have essentially stopped doing business with each other. The remarks came in interview that aired Sunday on NBC’s Meet the Press with Kristen Welker.