Oil stays near multi-month lows on demand worries


*Oil prices

Erasing earlier gains, Brent crude futures were down 51 cents, or 0.5%, at $94.41 a barrel by 0816 GMT. U.S. West Texas Intermediate crude was at $88.58 a barrel, down 43 cents, or 0.5%.

Front-month Brent prices last week hit the lowest since February, tumbling 13.7% and posting their largest weekly drop since April 2020, while WTI lost 9.7%, as concerns about a recession hitting oil demand weighed on prices.

“Last week’s price action left no doubt that recession-driven demand concerns have the upper hand over supply fears. One could even go as far as saying the war premium has evaporated,” PVM analyst Stephen Brennock said.

Both contracts recouped some losses on Friday after jobs growth in the United States, the world’s top oil consumer, unexpectedly accelerated in July.

On Sunday, China also surprised markets with faster-than-expected growth in exports.

China, the world’s top crude importer, brought in 8.79 million barrels per day (bpd) of crude in July, up from a four-year low in June, but still 9.5% less than a year earlier, customs data showed.

In Europe, Russian crude and oil products exports continued to flow ahead of an impending embargo from the European Union that will take effect on Dec. 5.

Last week, the Bank of England warned of a protracted recession in Britain.

Gasoline demand in the United States continues to weaken despite falling prices at the pump, and stockpiles are rising.

In terms of U.S. production, energy firms last week cut the number of oil rigs by the most since September in the first drop in 10 weeks.

News  YEAC commends govt's planned establishment of 18 modular refineries

The U.S. clean energy sector received a boost after the Senate on Sunday passed a sweeping $430 billion bill.

*Shadia Nasralla, Florence Tan, Editing: Mark Potter – Reuters



This article was originally posted at sweetcrudereports.com

Be the first to comment

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.