(Alliance News) - Oil prices sunk on Monday after some leading producers ramped up production, raising concerns over a supply glut at the time when the demand outlook remains uncertain.

A barrel of Brent oil fetched USD60.44 early Monday afternoon in London, down from USD61.76 at the same time on Friday. West Texas Intermediate crude fell to USD57.43 a barrel from USD58.83.

Oil prices came under pressure due to the worsening global economic outlook, primarily driven by the trade disputes initiated by US President Donald Trump, which have forced a downward revision of demand expectations, ActivTrades analyst Ricardo Evangelista said.

The announcement by Opec+ of planned production increases has added further pressure on the energy market, Evangelista said.

"Increasing supply at a time when demand expectations are weakening typically leads to lower prices - and that is what we are seeing today," the ActivTrades analyst said.

Eight Opec+ members announced a sharp increase in production, AFP reports. The output increase of 411,000 barrels a day announced by Saudi Arabia, Russia and six other members of the oil cartel on Saturday added to concerns about over-supply.

"Adding to the uncertainty: the group will decide on output levels month by month," ING analyst Warren Patterson said, adding that the cartel will decide July output levels on June 1.

ActivTrades analyst Evangelista also noted that geopolitical turbulence in the Middle East could lead to further escalation and limit the downside for oil prices.

Yemen's Houthis on Monday accused the US of carrying out strikes in and around Sanaa, after the Iran-backed rebels claimed a missile strike on Israel's main airport, AFP reports.

In other commodities, spot gold was quoted at USD3,313.77 an ounce on Monday, up from USD3,257.67 on Friday. Silver firmed to USD32.43 an ounce from USD32.33.

The yellow metal rose on Monday as lingering uncertainty over US-China trade negotiations and renewed geopolitical risks boosted demand for safe-haven assets, Traze's Erkin Kamran said.

"Tensions in Eastern Europe remain a source of concern, while new developments in the Middle East could keep investors cautious," Kamran said.

"Trade negotiations between the US and China are a key factor in the precious metal's value," Traze's Kamran said, adding: "While President Donald Trump stated over the weekend that China was eager to reach a deal, Beijing reiterated its conditions for resuming talks, highlighting the absence of any imminent progress."

The US-China stalemate, combined with a weaker dollar, helped support gold, he said.

Elsewhere, platinum was priced at USD967.15 an ounce on Monday, slightly down from USD967.67 on Friday. Palladium was quoted at USD963.53 an ounce, up from USD944.00, however.

The copper price rose to USD9,359.00 per tonne from USD9,245.50, and aluminium was up to USD2,424.00 from USD2,408.50.

By Artwell Dlamini, Alliance News reporter

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