Oil prices fell 2% on Wednesday as sources said OPEC+ would consider accelerating its oil output increase in June, but losses were contained following a report that U.S. President Donald Trump may cut tariffs on Chinese imports.

Brent crude futures settled down $1.32, or 1.96%, at $66.12 a barrel, while U.S. West Texas Intermediate crude ended $1.40, or 2.2%, lower at $62.27.

Global benchmark Brent hit a session high of $68.65, its highest since April 4, before the OPEC+ news.

Some OPEC+ members are set to suggest the group accelerate its oil output increase for a second straight month in June, three sources familiar with the OPEC+ talks told Reuters.

There has been recent tension among OPEC+ members over compliance with output quotas. "I wouldn't be surprised if OPEC wanted to increase production. That could raise concerns about the cohesion of the cartel. Maybe they're tired of holding back production increases," said Phil Flynn, an analyst at Price Futures Group.

Both benchmarks pared some losses in afternoon trade after Kazakhstan's Energy Ministry issued a statement saying that Kazakhstan, not an OPEC member but an ally in the OPEC+ group, was a responsible participant in the international energy community and was interested in predictability and a balance of demand and supply.

Kazakhstan has angered other OPEC+ members by producing more than its allocated quota.

"Our participation in OPEC+ is an important tool for ensuring global stability, creating conditions for the implementation of national plans and attracting investment. We are committed to working constructively within the framework of the agreement and fulfilling our obligations," the statement quoted Energy Minister Erlan Akkenzhenov as saying.

Akkenzhenov had earlier told Reuters that his country would prioritize national interests over those of the OPEC+ producer group when deciding on its oil output levels. The market also got some support after government data showed U.S. crude inventories rose unexpectedly last week, while gasoline and distillate inventories fell more than expected.

"We're seeing an optimistic product inventory draw during the production season," said Josh Young, chief investment officer at Bison Interests. "That doesn't seem to reflect the potential demand slowdown from Trump's tariffs/trade war." (Newsmaker23)

Source: Reuters