Crude oil prices fall as OPEC cuts demand predictions
Date
9/12/2024 5:01:29 AM
(MENAFN) On Tuesday, U.S. crude oil futures experienced a significant drop, erasing gains made in the previous session, following OPEC’s decision to lower its demand forecast for the second time in two months. brent crude futures fell below USD70 per barrel for the first time since December 2021, marking a decline of approximately 4 percent. This downturn came after OPEC revised its demand growth estimate downward, now projecting an increase of about 2 million barrels per day in 2024, which is 100,000 barrels per day less than previously anticipated.
The reduction in OPEC's demand forecast reflects ongoing concerns over weaker consumption, particularly in China, the world's largest crude oil importer. The group expects demand to grow by about 1.7 million barrels per day next year, which is also slightly reduced from earlier predictions. The downgrade is attributed to slower consumption growth in China and rising electric vehicle sales, which have dampened oil demand. This adjustment follows a similar cut in August due to the persistent issue of weak demand in the Chinese market.
The oil market has been under pressure as bearish sentiment takes hold, with both U.S. crude and global benchmark Brent crude recording their worst weekly performance since October 2023. Additionally, OPEC+ is anticipated to increase output in December, which, coupled with forecasts of a potential surplus in 2025 from analysts such as Morgan Stanley, has further contributed to the negative outlook for oil prices.
MENAFN12092024000045015682ID1108665590
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.