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Brent, WTI down around 2% this week

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Market braces for another OPEC+ output hike in July

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Iranian nuclear deal talks in focus, fifth round on Friday

(Recasts with comments, updates prices, adds bullets)

By Siyi Liu

SINGAPORE, May 23 (Reuters) - Oil prices dropped for a

fourth consecutive session on Friday and were set for their

first weekly decline in three weeks, weighed down by renewed

supply pressure from another possible OPEC+ output hike in July.

Brent futures fell 31 cents, or 0.5%, to $64.13 a

barrel by 0412 GMT. U.S. West Texas Intermediate crude futures

lost 33 cents, or 0.5%, to $60.87.

For the week, Brent has fallen 1.9%, and WTI has dropped

2.5%, following two weeks of gains.

Both contracts touched their lowest in more than one week on

Thursday after a Bloomberg News report that OPEC+ was

considering another large production increase at a meeting on

June 1.

Increasing output by 411,000 barrels a day (bpd) for July

was among the options discussed, but no final agreement has yet

been reached, the report said, citing delegates.

"The oil market is under renewed pressure as noise builds

around what OPEC+ will do with their July output levels," ING

analysts wrote in a research note.

They expect that OPEC+ will go ahead with a 411,000 bpd

supply increase for July and currently forecast Brent to average

$59 per barrel in the fourth quarter.

OPEC+, which includes the Organization of the Petroleum

Exporting Countries and allies such as Russia, agreed to

increase production by nearly 1 million barrels per day (bpd) in

April, May and June.

The supply tailwind offset jitters earlier this week

triggered by a report saying Israel is making preparations to

strike Iranian nuclear facilities and new sanctions announced by

the EU and Britain on Russia's oil trade.

A large crude oil build in the U.S. also weighed on oil

prices.

As traders brace for a flood of increased supply in coming

months from OPEC+, U.S. crude oil storage demand has surged in

recent weeks to levels similar to the COVID-19 pandemic,

according to data from storage broker The Tank Tiger.

On Friday, the market will watch for U.S. oil and gas rig

count data from Baker Hughes ( BKR ) that is used as an indicator for

future supply.

The market is also closely watching U.S.-Iranian nuclear

negotiations which could determine the future supply of Iranian

oil. The fifth round of talks will take place in Rome on Friday.