Oil prices fall as OPEC+ cuts demand forecasts, global indices weaken
Date
9/11/2024 6:04:57 AM
(MENAFN) brent crude futures dropped below the USD70 per barrel mark on Tuesday, a level not seen since December 2021, following a downward revision of demand forecasts by OPEC+. As of 15:08 GMT, Brent crude futures were trading at USD69.51 a barrel, down by USD2.33 or 3.24 percent. Similarly, U.S. West Texas Intermediate (WTI) crude futures fell to USD66.21 a barrel, marking a decline of USD2.50 or 3.64 percent. This fall comes after both benchmarks saw a slight rise of about 1 percent at Monday's settlement.
OPEC, in its latest monthly report, announced a reduction in its global oil demand growth forecast for 2024, lowering the expected increase to 2.03 million barrels per day from the 2.11 million barrels per day projected last month. This adjustment marks the first change since OPEC initially issued its forecast in July 2023. The organization further cut its 2025 global oil demand growth estimate from 1.78 million barrels per day to 1.74 million, citing signs of weaker global demand and the potential for a surplus in oil supply.
Adding to the bearish sentiment, data from China showed mixed economic signals. On Monday, figures indicated that China's consumer inflation accelerated in August to its fastest pace in six months, yet domestic demand remained subdued and producer price deflation deepened. While China's exports grew at their fastest rate in nearly a year and a half in August, import levels were disappointing, reflecting ongoing weakness in domestic demand.
Additionally, external factors are influencing the market, including weather conditions. The U.S. National Hurricane Center reported that Tropical Storm Francine was rapidly advancing over the Gulf of Mexico and was expected to strengthen into a hurricane by Tuesday. In response, major oil companies such as ExxonMobil, Shell, and Chevron have evacuated offshore platforms and suspended some of their oil and gas operations in the Gulf, further complicating supply dynamics.
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