Oil prices declined on Monday amid demand uncertainty ahead of the release of economic data from the world’s largest oil consumers.
International benchmark Brent crude traded at $78 per barrel at 10.10 am local time (0710 GMT), a 0.60% fall from the closing price of $78.47 a barrel in the previous trading session on Friday.
The American benchmark West Texas Intermediate (WTI) traded at the same time at $73.50 per barrel, down 0.49% from the previous session’s close of $73.86 per barrel.
Prices declined amid uncertainty before new economic data expected from the US and China, the world’s largest oil consumer and importer, respectively.
China’s latest economic data showed a slowdown in economic growth, raising the prospect of a reduction in oil demand, which would impact prices. Market players remain cautious ahead of the US CPI readings and Chinese GDP data later this week.
The rise of the US dollar against other currencies aided the fall in oil costs. The US dollar index, which measures the US dollar’s value against other currencies, increased 0.22% to 102.49. The strong dollar is expected to lower demand by making oil more expensive for those who use foreign currencies.
Meanwhile, expected crude oil supply cuts from Saudi Arabia and Russia are limiting price declines. Both Saudi Arabia and Russia recently decided to extend existing crude oil supply cuts.
Saudi Arabia, the world’s largest exporter of crude oil, announced its intention last Monday to unilaterally extend production cuts of 1 million barrels per day (bpd) through August, leaving the door open for further extensions.
Russia followed suit with an announcement of a voluntary reduction of exports by 500,000 bpd in August, on top of the 700,000 bpd in place since March.
Source: Anadolu Agency