Oil Slips as Global Demand Worries Weigh, OPEC+ Meeting Considered, Energy News, ET EnergyWorld
LONDON: Oil slid on Tuesday as investors absorbed the bleak outlook for fuel demand, with data pointing to a global slowdown in manufacturing just as OPEC+ producers meet this week to decide whether to raise whether or not the offer.
Surveys showed on Monday that factories in the United States, Europe and Asia struggled to find momentum in July as lower global demand and strict COVID-19 restrictions in China slowed production. .
“These readings did nothing to alleviate recession fears,” said Tamas Varga of oil broker PVM.
Brent crude was down $1.40, or 1.4%, at $98.63 a barrel at 0817 GMT, while US West Texas Intermediate crude fell $1.00, or 1.1%, at $92.89.
Oil soared earlier in 2022, with Brent nearing its all-time high of $147 a barrel in March following Russia’s invasion of Ukraine, compounding supply issues. Concerns about slowing growth have since overshadowed tight supply.
“Upward momentum in oil prices is gradually fading,” analysts at Haitong Futures said. “Once the supply and demand situation shows signs of further deterioration, oil should lead the decline among commodities.”
The focus this week is on a meeting on Wednesday between the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, known as OPEC+, to decide whether to increase production in september.
Two of eight OPEC+ sources told Reuters a modest increase for September would be discussed, while the others said producers were likely to maintain production.
Also appearing are the latest weekly readings on US stocks. Analysts expect crude oil and gasoline inventories to decline. The first report this week is due at 8:30 p.m. GMT from the American Petroleum Institute.