On Monday, crude oil prices declined after experiencing a robust weekly gain while demand concerns pressure on the chances of weak supply.
West Texas Intermediate crude oil futures for August delivery went down by -0.74% to $73.31 per barrel. Likewise, Brent oil contracts for September export fell by -0.78% to $77.86 a barrel on July 10’s Asian afternoon session.
Last week, the two benchmarks gained 4.00%, their highest level since May. According to economists, markets value the material balance reduction in Q3.
On the other hand, crude oil could hit two consecutive weeks of highs after lesser outputs. Saudi Arabia added more cuts and immediately took effect, extending it to August. In addition, some members of the OPEC+ are having longer production slashes.
Saudi will lengthen its one million barrels per day (bpd) volume cut while Russia will lessen deliveries to 500,000 bpd. Moscow used the crude to make more fuel to satisfy domestic demand rather than cutting inventories.
Furthermore, non-OPEC+ supply has been keeping a good pace with the global demand, based on experts. They added that the organization needs more slashes of 700,000 bpd in the year’s second half.
Last year, the world’s top economy rolled out 180 million barrels. It came from the storage to deal with the oil supply issues in military operations.
Economic Data Uncertainty Weighs on Oil
Due to the release of economic data from major oil-consuming countries, prices were negatively affected.
Also, costs went down ahead of the information reported from the American and Chinese economies. Besides, the US is the biggest consumer while the Asian nation is the largest importer.
China’s most recent economic data highlighted a slowdown in its economy’s growth. As a result, it would negatively impact oil demand and pressure prices. Market players are careful about the upcoming US CPI and Chinese GDP data.
Additionally, the higher value of the American dollar against other currencies contributed to the lower oil prices. The US dollar index showed that there is a 0.22% to 102.49. Moreover, the dollar’s strength is anticipated to weigh down demand.
