Oil prices stabilize amid halted Libyan exports, mixed demand signals

(MENAFN) On Monday, oil prices showed little change as markets adjusted to recent developments affecting supply and demand. By mid-afternoon GMT, Brent crude futures were down slightly by 6 cents, or 0.08 percent, trading at USD76.87 per barrel, while West Texas Intermediate (WTI) crude futures gained 8 cents, or 0.11 percent, reaching USD73.63 per barrel. The modest fluctuations occurred against the backdrop of a public holiday in the U.S. market. Last week, oil prices experienced declines, with Brent dropping 1.4 percent and WTI falling 3.1 percent, driven by expectations of increased production from OPEC+ starting in October and signs of weakening demand in major economies.

Libyan oil exports have been disrupted, contributing to the volatility in oil prices. Exports from key Libyan ports remain halted due to ongoing political conflicts over the control of oil revenues and the central bank. Despite this, Libya's Arabian Gulf Oil Company has resumed limited production of approximately 120,000 barrels per day to support local power needs. Meanwhile, OPEC+ is poised to implement a planned increase in oil production from October, with eight member countries set to boost output by 180,000 barrels per day. This move is part of a gradual strategy to ease the 2.2 million barrels per day production cuts imposed earlier, while continuing to adjust cuts through the end of 2025.

The broader market sentiment remains cautious due to economic concerns in China and the U.S., which have overshadowed the impact of supply disruptions. Recent data revealed that China's manufacturing activity fell to a six-month low in August, exacerbating fears of diminished demand. Retail prices at factories decreased, and order volumes shrank, further dampening market outlooks. Both Brent and WTI crude have faced declines over the past two months as these economic uncertainties weigh heavily on global oil markets. 

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