2023-07-03 02:22:00
© Archyde.com. Two pumps work inside an oil field outside Sodron, France, on February 6, 2023. Photograph: Pascal Rossignol/Archyde.com.
SINGAPORE (Archyde.com) – It fell in early Asian trading on Monday, as fears of a global economic slowdown and the prospect of the US Federal Reserve raising interest rates were offset by expectations of reduced supplies in light of the cuts announced by the OPEC + group.
Crude futures fell 20 cents, or 0.3%, to 75.21 a barrel by 0044 GMT, following settling 0.8% higher on Friday. US West Texas Intermediate crude fell 23 cents, or 0.3%, to $70.41, following closing up 1.1% in the previous session.
Brent fell for the fourth consecutive quarter at the end of June, while WTI crude recorded a second quarterly decline as the world’s two largest economies, the United States and China, slowed in the second quarter.
Fears of a further slowdown hurting fuel demand grew following data on Friday showed that inflation in the United States was still above the central bank’s 2 percent target and raised expectations that it would raise interest rates once more.
“The hawkish comments on interest rates continue to raise concerns regarding the demand outlook affecting prices,” National Australia Bank analysts said in a note.
Higher interest rates would strengthen the US currency, making commodities more expensive for holders of other currencies and also reduce demand for oil.
Some analysts expect reduced supplies and higher prices in the second half of the year following Saudi Arabia, the world’s largest oil exporter, pledged to cut output by regarding 1 million barrels per day more in July while the United States gradually replenishes its strategic oil reserves.
A Archyde.com survey showed that OPEC’s oil production declined only slightly in June, as production increases in Iraq and Nigeria limited the impact of cuts from other producers.
(Prepared by Hassan Ammar for the Arabic Bulletin)
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