Oil drops over $1 as OPEC+ decision spotlights shaky demand

At its lowest on Tuesday, traded at $76.76, less than $2 shy of this year's nadir of $74.79 at the beginning of January.

U.S. West Texas Intermediate crude futures eased by $1.09, or 1.5%, to $73.13. WTI had fallen by 3.6% on Monday to settle near a four-month low.

The Organization of the Petroleum Exporting Countries and allies led by , together known as OPEC+, agreed on Sunday to extend most of their oil into 2025 but left room for voluntary cuts from eight members to be unwound gradually, beginning in October.

"The reaction is depressing to anyone who produces oil and brings elevated joy for consumers," said Tamas Varga of oil broker .

The planned October unwinding adds jitters about oversupply in an environment where traders are already spooked about high interest rates hampering global , with a steady flow of dim signals from major economies such as the United States, China and Europe suggesting that their appetite for oil may not be as healthy as hoped through the rest of the year.

On top of this, is rising from non-OPEC producers such as the U.S.

"With the 'bad news is bad news' mantra in place, further evidence of economic weakness may lead oil prices lower," market strategist Yeap Jun Rong said in an email.

The U.S. government release and supplied data on Wednesday.

Product supplied, considered a proxy for demand, will show how much gasoline was consumed around the Memorial Day weekend, the start to the U.S. driving season.