(MENAFN- Trend News Agency)
Oil prices edged lower on Monday, reversing earlier gains, as
concerns about slowing global economic growth and fuel demand
outweighed worries about tightening supplies, Trend reports with reference
to Reuters .
Brent crude futures slipped 3 cents to $113.09 a barrel by 0515
GMT, after rising as much as 1% earlier. Front-month prices tumbled
7.3% last week, their first weekly fall in five.
U.S. West Texas Intermediate crude was at $109.42 a barrel, down
14 cents, or 0.1%, after rising more than $1 earlier. Front-month
prices dropped 9.2% last week, the first decline in eight
weeks.
'Clearly macro factors are driving oil at the moment, rather
than fundamentals, which are still supportive,' said Warren
Patterson, ING's head of commodities research.
CMC markets analyst Tina Teng said lower oil prices were due to
'broad recession fears after the (U.S.) Fed outsized its rate hike
to 75 basis points, which was followed by similar tightening
approaches by the Bank of England and the Swiss National Bank last
week.'
The impact has been partly mitigated by the release of strategic
petroleum reserves, led by the United States, and a ramp-up of
production from the Organization of the Petroleum Exporting
Countries (OPEC) and its allies, together known as OPEC+, although
that is thinning the world's buffer against further supply
disruption.
'If Washington sticks to its current pace, the U.S. strategic
reserve will hit a 40-year low of 358 million barrels by October,'
ANZ analysts said in a note.
China's crude oil imports from Russia, however, soared 55% from
a year earlier to a record level in May, displacing Saudi Arabia as
the top supplier, as refiners cashed in on discounted supplies amid
sanctions on Moscow.
Still, U.S. oil and gas production is climbing.
The oil and gas rig count, an early indicator of future output,
rose by seven to 740 in the week to June 17, its highest since
March 2020, energy services firm Baker Hughes Co said in its report
on Friday.
In OPEC member Libya, meanwhile, oil production remained
volatile following blockades by groups in the country's east.
The Libyan Oil Minister Mohamed Oun told Reuters on Monday that
the country's total production is at about 700,000 barrels per day
(bpd). Libya's output had fallen to 100,000 to 150,000 bpd, a
spokesman for the oil ministry said last week.
Elsewhere, oil products exports from China, once a major
exporter, continued to decline, keeping global supplies tight.
The country's gasoline exports in May fell 46% from a year
earlier and diesel exports plunged 93% despite stalling domestic
demand, as companies ran short of export quotas, Chinese customs
data showed on Saturday.
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