Oil prices slip as weak factory data fuels global demand concerns

Sticker reads crude oil on the facet of a storage tank within the Permian Basin in Mentone, Loving County, Texas, U.S. November 22, 2019. REUTERS/Angus Mordant

Aug 2 (Reuters) – Oil costs edged decrease on Tuesday as buyers absorbed a bleak outlook for gasoline demand with knowledge pointing to a world manufacturing downturn simply as main crude producers meet this week to find out whether or not to extend provide.

Brent crude futures dropped 24 cents, or 0.2%, to $99.82 a barrel by 0634 GMT, whereas WTI crude futures eased 10 cents, or 0.1%, to $93.78 a barrel.

The slide got here after Brent futures slumped on Monday to a session low of $99.09 a barrel, their lowest since July 15. The U.S. crude benchmark dropped to as little as $92.42 a barrel, its weakest since July 14.

“Crude costs tumbled after a wealth of manufacturing facility exercise knowledge steered the world is headed in the direction of a large world financial contraction, and on expectations for extra oil output following an excellent earnings season for oil firms,” stated Edward Moya, senior market analyst from OANDA, in a word.

Recessionary issues have been heightened on Monday as surveys from america, Europe and Asia confirmed that factories struggled for momentum in July. Flagging world demand and China’s strict COVID-19 restrictions slowed manufacturing. learn extra

The worth drops additionally come as market members await the result of a gathering on Wednesday between the Group of the Petroleum Exporting International locations (OPEC) and allies together with Russia, collectively often called OPEC+, to resolve on September output.

Two of eight OPEC+ sources in a Reuters survey stated {that a} modest improve for September could be mentioned on the Aug. 3 assembly. The remaining stated output is more likely to be held regular. learn extra

A Fox Enterprise information reporter stated Saudi Arabia will push OPEC+ to extend oil manufacturing on the assembly. learn extra

“The upward momentums of oil costs has been progressively fading … As soon as the provision and demand state of affairs exhibits any signal of additional deterioration, oil is more likely to lead the decline amongst commodities,” analysts from Haitong Futures stated.

In the meantime america on Monday imposed sanctions on Chinese language and different companies it stated helped to promote tens of hundreds of thousands of {dollars}’ in Iranian oil and petrochemical merchandise to East Asia because it seeks to boost strain on Tehran to curb its nuclear programme. learn extra

Additionally casting a cloud over the market is the potential for a go to to Taiwan by U.S. Speaker of the Home Nancy Pelosi, regardless of Beijing’s warnings towards it. The go to would mark the primary time a high-profile U.S. official has been on the island in over 25 years, which might escalate tensions between the U.S. and China. learn extra

Reporting by Stephanie Kelly and Muyu Xu; Modifying by Kenneth Maxwell

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